Trump Slaps 93.5% Anti-Dumping Tariff on Chinese Graphite—Total Import Costs Now a Whopping 160%

Trade tensions flare as the U.S. cranks up the pressure on Chinese imports.

Graphite—the latest battleground in the ongoing trade war—just got a lot more expensive. The Trump administration’s new 93.5% anti-dumping tariff sends a clear message: play by our rules or pay up. With total import costs now hitting 160%, manufacturers are scrambling for alternatives—or bracing for the financial squeeze.

Wall Street shrugs—because when has a trade war ever hurt profits?

Automakers react as tariff disrupts battery supply

The tariff comes at a time when carmakers are already facing increasing pressure to keep EV production costs low. Sam Adham, who leads the battery materials division at CRU Group, said the total 160% tariff now adds $7 per kilowatt-hour to the cost of making a standard battery cell. 

That equals 20% of the value of the tax credit offered under the Inflation Reduction Act, which made it through Trump’s budget approval. “That basically wipes out profits for one or two entire quarters for the Korean battery makers,” Sam said.

Companies like Tesla and Panasonic pushed against the new duties before the announcement. They argued that U.S. manufacturers still can’t produce graphite at the quality or volume required for electric vehicle batteries. Tesla, which currently depends heavily on graphite imports from China, was among the firms that tried to block the tariff. Following the decision, Tesla’s shares dropped by 1.4% on Thursday.

The restriction on Chinese graphite imports hits harder because China controls most of the global processing capacity for the material. That was made clear in a May report by the International Energy Agency, which flagged graphite as one of the most vulnerable battery materials in the global supply chain. 

The report said it “requires urgent efforts for diversification” if manufacturers want to avoid major disruptions. And there’s no quick fix. The IEA also noted that graphite is still expected to be the primary anode material for lithium-ion batteries at least until 2030, when silicon might begin to take a small share of the market.

Trade beef with China adds fuel to global economic tension

This new tariff comes at a moment when tensions between China and the United States remain high. The relationship between the two countries has been strained ever since the People’s Republic of China was formed in 1949 and the previous government fled to Taiwan.

Things calmed down in the 1970s after the two countries normalized relations, but disputes have never stopped. The list includes disagreements over Taiwan’s status, economic policies, and territorial claims in the South China Sea.

Even with the constant friction, the two economies are deeply connected. As of 2025, the United States is the largest economy by nominal GDP, and China is second. Measured by purchasing power parity, the rankings reverse. Combined, the two countries account for 44.2% of global GDP by nominal value, and 34.7% of global GDP adjusted for PPP. Any trade action between them, like this tariff, has immediate global effects.

For now, the Commerce Department says the preliminary ruling stands, and the final outcome will be announced in December. The implications are already clear. Automakers will have to make some tough calls. Prices are going up. Margins are going down. And unless someone finds a replacement for graphite fast, this tariff just rewrote the rules for building electric vehicles in the U.S.

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