The Trump administration has hit Chinese graphite with a steep 93.5% tariff, targeting a raw material essential for making electric vehicle (EV) batteries. While the move aims to support American producers, it could also drive up the cost of building EVs in the U.S., at least in the short term.

What’s Happening and Why It Matters

On Thursday, the U.S. Commerce Department announced the new tariff, accusing China of “dumping” graphite — selling it below fair market value.

Graphite is a key ingredient in lithium-ion batteries, the type used in most electric cars. Nearly all of it currently comes from China, which dominates global supply. American companies say that’s made it tough for them to grow.

But U.S. automakers warn this move could hurt EV production, especially since American producers still don’t make enough — or pure enough — graphite for battery use.

The Numbers Behind the Tariff

• 93.5%: New tariff rate on Chinese graphite
• $347 million: Value of Chinese graphite imports to the U.S. in 2023
• < $2 per pound: Cost of raw graphite
• 99.9% purity: What EV batteries require — and what U.S. producers can’t yet deliver

Mike O’Kronley, CEO of U.S.-based graphite company Novonix, supports the tariff and believes it will boost the American industry:

“This is going to be very transformative… It’s hampering the development of the U.S. critical minerals,” he told CNN.

Will U.S. Companies Catch Up?

EV makers like Tesla argue the U.S. doesn’t yet have the capability to meet their needs.

“Not a single U.S. producer is able to produce [graphite] to these exacting specifications,” Tesla lawyer Matt Nicely said during a hearing in January.

Even supporters of the tariff admit the benefits won’t come overnight.

“It’s not very easy to switch or change supply,” O’Kronley added. “But we will see changes over time.”

Trade War and EV Policy Shift

This move is part of a larger crackdown on Chinese imports under the Trump administration. It’s also happening as Trump cuts back support for the EV industry.

The new spending bill he signed into law removes the $7,500 EV tax credit and pushes to cancel federal loans that help fund EV and battery factories.

Combined with earlier tariffs, the total duties on Chinese graphite could now reach around 160%.

What’s Next for EV Buyers and Automakers?

For now, battery makers will pay more, and that cost could be passed on to car buyers.

Until the U.S. can scale up production and hit the high-purity standards required, it will remain dependent on imported graphite — just at a higher price.

Whether this move jumpstarts the domestic industry or slows down EV growth remains to be seen. One thing is clear: the road to electrification in the U.S. just got bumpier.

Source: CNN – Chinese graphite is crucial to electric car batteries. Trump just put a 93.5% tariff on it

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