Tesla Inc. (NASDAQ: TSLA) shares edged lower as investors reacted to reports that Beijing is considering tighter export controls on high-end solar manufacturing equipment. The potential policy shift raises concerns over Tesla's expanding U.S. solar production plans, despite its energy storage business outperforming the automotive segment.

Discussions in Beijing remain preliminary, but restrictions could target advanced machinery used in next-generation solar production, including systems for high-efficiency heterojunction (HJT) solar cells. Geopolitical friction between the U.S. and China adds uncertainty to Tesla's long-term energy strategy.

The broader industry trend shows automakers pivoting toward energy storage as EV growth slows and competition intensifies. Tesla's reliance on global supply chains leaves it vulnerable to regulatory shifts, particularly in critical solar technology.