German Suppliers Tesla Denies Cancelling Order to Put America First

U.S. electric car maker Tesla confirms it has canceled an order with German car parts supplier SHW Group. But they say the move was related to technical problems, not President Donald Trump's protectionist economic policies.
Elon Musk, left, attended a meeting with U.S. President Trump on Monday in the White House, along with around a dozen of other executives.

U.S. electric carmaker Tesla confirmed Thursday it had canceled an order with German car parts supplier SHW Group, but denied the move has anything to do with U.S. President Donald Trump's economic policies.

SHW, a maker of oil engine pumps and brake discs, said Tuesday a maker of fully electric cars had canceled an order of electric axle drive pumps for technical reasons, causing its shares to fall by 9.5 percent. The order had a value of around €100 million, or $107 million.

“We can confirm that Tesla is the mentioned e-car manufacturer and that we had to cancel the order, because the required performance and quality standards were not met,” a Tesla spokesman told German business weekly, WirtschaftsWoche, a sister publication of Handelsblatt Global.

News agency Reuters cited a Tesla spokeswoman as saying: “The main reason why we now confirm that we canceled the order is to counter those utopian claims‎ that we were acting in response to political pressure. The fact is the order was canceled because technical standards weren't complied with."

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.

An SHW spokesman again declined to name the company which canceled the order but said it had nothing to do with technical deficiencies. SHW was still considering legal action against the company that cancelled the order.

Last year, Tesla sued car parts maker Hoerbiger, accusing the company of supplying it with faulty components for the wing doors of its new Model X car. Hoerbiger, a Swiss firm with most of its European plants located in southern Germany, denied the allegation.

 

This article first appeared on the website of German business weekly WirtschaftsWoche, a sister publication of Handelsblatt Global. To contact the author: [email protected]