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Tesla Denies Rumors Trump Pressured It To Cancel Contracts With German Company

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Chris White Tech Reporter
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Tesla Motors denied rumors the electric company was pressured by President Donald Trump to cancel contracts with a German parts supplier.

Tesla canceled a large order with Germany’s SHW because the supplier was supposedly unable to meet its contractual obligations to the California-based automaker, the company wrote in an email to reporters Friday.

The clarification was necessary, the company said, to quell rumors surfacing suggesting the move was meant to appease Trump, who has made placing America first a key cog in his campaign to resuscitate manufacturing jobs.

Tesla said the decision was made to ensure poor performing suppliers would not hurt production on the Model 3, a car being sold as Tesla’s first wallet-friendly electric vehicle. CEO Elon Musk has stated in the past a willingness to jettison suppliers that make it more difficult for the company to meet production target dates.

“Tesla’s policy is to terminate any supplier that is unable to meet their contractual milestones or violates their non-disclosure agreement,” the carmaker said in the email.

Tesla told reporters Thursday that “the main reason why we now confirm that we canceled the order is to counter … claims‎ that we were acting in response to political pressure.”

German media outlet Handelsblatt, meanwhile, suggested earlier this month that the U.S. president wants Musk and others to cancel building plants in foreign countries.

“Tesla’s Chief Executive Elon Musk is an advisor to Mr. Trump, who has urged car makers to cancel building plants outside the United States and buy locally manufactured vehicles and car parts instead,” the media reported shortly after the announcement.

Musk was one of several executives who attended a Trump business forum on Jan. 25 — the Tesla boss was joined by business tycoons from Lockheed Martin, Whirlpool, Under Armour, and Johnson & Johnson. He also joined a manufacturing jobs initiative announced Friday by the White House.

Musk, who once said Trump’s character reflects poorly on the U.S., has become a reluctant admirer of the president, going so far as to suggest Trump might not surprise environmentalists on the climate. He also implored his activist friends to reason with the real estate tycoon.

“Simply attacking him will achieve nothing,” Musk pointed out. “Are you aware of a single case where Trump bowed to protests or media attacks?”

The California billionaire also offered an endorsement of Trump’s secretary of state nominee, Rex Tillerson, last week, saying the former Exxon CEO “has the potential to be an excellent Sec of State.”

Tesla receives troves of government tax credits. The electric car maker recently acquired solar panel provider SolarCity, which was founded and directed by several members of Musk’s inner circle and is propped up primarily by billions in taxpayer dollars.

Musk is sidling up to Trump at an opportune moment. The president’s election victory might mean the end of some federal tax subsidies for solar power and electric cars, according to a WSJ report in November.

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