Automotive Industry

Shareholders approved the pay package with as much as 75 percent support on Thursday.

Tesla CEO Elon Musk has scored a resounding victory as shareholders have approved a pay package of as much as $878bn over the next decade, endorsing his vision of morphing the electric vehicle (EV) maker into an AI and robotics juggernaut.

Shares of Tesla rose more than 3 percent in after-hours trading after the shareholders voted on Thursday. The proposal was approved with more than 75 percent support.

Musk took to the stage in Austin, Texas, along with dancing robots. “What we are about to embark upon is not merely a new chapter of the future of Tesla, but a whole new book,” he said. “This really is going to be quite the story.”

He added: “Other shareholder meetings are like snooze fests, but ours are bangers. I mean, look at this. This is sick.”

Shareholders also re-elected three directors on Tesla’s board and voted in favour of a replacement pay plan for Musk’s services because a legal challenge has held up a previous package.

The vote, analysts have said, is a positive for Tesla’s stock, whose valuation hangs on Musk’s vision of making vehicles drive themselves, expanding robotaxis across the United States and selling humanoid robots, even though his far-right political rhetoric has hurt the Tesla brand this year.

A win for Musk was widely expected as the billionaire was allowed to exercise the full voting rights of his roughly 15 percent stake after the carmaker moved to Texas from Delaware, where a legal challenge has held up a previous pay rise.

The approval comes even after opposition from some major investors, including Norway’s sovereign wealth fund.

Tesla’s board had said Musk could quit if the pay package was not approved.

The vote will also allay investor concerns that Musk’s focus has been diluted with his work in politics as well as in running his other companies, including rocket maker SpaceX and artificial intelligence startup xAI.

The board and many investors who lent their endorsement have said the nearly $1 trillion package benefits shareholders in the longer run, as Musk must ensure Tesla achieves a series of milestones to get paid.

Goals for Musk over the next decade include the company delivering 20 million vehicles, having one million robotaxis in operation, selling one million robots and earning as much as $400bn in core profit. But in order for him to get paid, Tesla’s stock value has to rise in tandem, first to $2 trillion from the current $1.5 trillion, and all the way to $8.5 trillion.

Under the new plan, Musk could earn as much as $878bn in Tesla stock over 10 years. Musk would be given as much as $1 trillion in stock but would have to make some payments back to Tesla.

The electric carmaker had unveiled chief Elon Musk’s proposed $1 trillion compensation plan in September.

Tesla’s proposed $1 trillion pay package for CEO Elon Musk has come under renewed scrutiny after proxy adviser Institutional Shareholder Services (ISS) urged investors to vote against what could be the largest compensation plan ever awarded to a company chief.

ISS’s comments on Friday marks the second consecutive year that it has urged shareholders to reject a compensation plan for Musk.

Proxy advisers often sway major institutional investors, including the passive funds that hold large stakes in Tesla.

The ISS recommendation adds pressure on Tesla’s board before a closely watched November 6 shareholder meeting and renews scrutiny of Musk’s compensation after a Delaware court earlier voided his $56bn pay package.

Musk’s record Tesla pay plan could still hand him tens of billions of dollars even if he falls short of most of its ambitious targets, however, thanks to a structure that rewards partial achievement and soaring share prices.

Last month, Tesla’s board proposed a $1 trillion compensation plan for Musk in what it described as the largest corporate pay package in history, setting ambitious performance targets and aiming to address his push for greater control over the company.

ISS said that while the board’s goal was to retain Musk because of his “track record and vision”, the 2025 pay package “locks in extraordinarily high pay opportunities over the next ten years” and “reduces the board’s ability to meaningfully adjust future pay levels.”

Tesla’s shares rose after the compensation plan was unveiled last month, as investors believe the pay package would incentivise Musk to focus on the company’s strategy.

“Many people come to Tesla to specifically work with Elon, so we recognise that retaining and incentivising him will, in the long run, help us retain and recruit better talent,” Director Kathleen Wilson-Thompson said in a video posted to Tesla’s X handle on Friday.

Unlike the 2018 pay deal, Musk will be allowed to vote using his shares this time, giving him about 13.5 percent of Tesla’s voting power, according to a securities filing last month. That stake alone could be enough to secure approval.

The proxy adviser cited the “astronomical” size of the proposed grant, design features that could deliver very high payouts for partial goal achievement and potential dilution for existing investors.

Tesla did not immediately respond to a request for comment from the Reuters news agency.

ISS valued the stock-based award at $104bn, higher than Tesla’s own estimate of $87.8bn.

The grant would vest only if Tesla reaches market capitalisation milestones up to $8.5 trillion and operational targets, including delivery of 20 million vehicles, one million robotaxis and $400bn in adjusted core earnings.

The proxy adviser’s guidance on Musk’s pay was part of a wider set of voting recommendations issued on Friday.

As of 3:45pm in New York (19:45 GMT), Tesla’s stock was up 2.4 percent.

Stellantis announced a $13bn investment in the US, which will see production of the Jeep Compass move to the US from Canada.

Canada has threatened legal action against carmaker Stellantis NV over what Ottawa says is the company’s unacceptable plan to shift production of one model to a United States plant.

On Wednesday, Minister of Industry Melanie Joly sent a letter to Stellantis CEO Antonio Filosa noting that the company had agreed to maintain its Canadian presence in exchange for substantial financial support.

“Anything short of fulfilling that commitment will be considered a default under our agreement,” she said. If Stellantis did not live up to its commitment, Canada would “exercise all options, including legal”, she said.

Stellantis announced a $13bn investment in the US on Tuesday, a move that it said would bring five new models to the market. As part of the plan, production of the Jeep Compass will move to the US state of Illinois from a facility in Brampton in the Canadian province of Ontario.

A copy of the letter was made available to the Reuters news agency. The existence of the letter was first reported by Bloomberg.

Stellantis had paused retooling of the Brampton plant in February, shortly after US President Donald Trump announced tariffs against Canadian goods, upending the highly integrated North American auto industry.

In a statement on Tuesday night, Canada’s Prime Minister Mark Carney said Ottawa had made clear it expected Stellantis to fulfil the undertakings it had made to the workers at the plant.

“We are working with the company to develop the right measures to protect Stellantis employees,” he said.

Ontario is Canada’s industrial heartland and accounts for about 40 percent of its national gross domestic product (GDP).

“I have spoken with Stellantis to stress my disappointment with their decision,” Ontario Premier Doug Ford said on social media on Wednesday.

Stellantis spokesperson LouAnn Gosselin said the company was investing in Canada and noted plans to add a third shift to a plant in Windsor, Ontario.

“Canada is very important to us. We have plans for Brampton and will share them upon further discussions with the Canadian government,” she said in an emailed statement.

Elon Musk’s $56bn pay package from Tesla should have been restored by a vote of the company’s shareholders last year, a Tesla attorney has said to the Delaware Supreme Court in the United States.

The Tesla lawyer made his arguments on Wednesday as one of the biggest corporate legal battles entered its final stage after a lower court judge had in January 2024 rescinded the Tesla CEO’s record compensation. The company is also appealing a ruling by the lower court that rejected as legally invalid a vote by shareholders to restore the pay package.

“This was the most informed stockholder vote in Delaware history,” Jeffrey Wall, an attorney for Tesla, told the justices. “Reaffirming that would resolve this case.”

The case’s outcome could have substantial consequences for the state of Delaware, its widely used corporate law, and its Court of Chancery, a once-favoured venue for business disputes that has recently been accused of hostility towards powerful entrepreneurs.

The Court of Chancery ruling striking down Musk’s pay has become a rallying cry for Delaware critics. Chancellor Kathaleen McCormick ruled that the Tesla board lacked independence from Musk when it approved the pay package in 2018 and that shareholders lacked key information when they voted overwhelmingly in favour of it. As a result, she applied a demanding legal standard and found the pay unfair to investors.

Musk did not attend the arguments, which were held in a special court to accommodate the 65 people in attendance, mostly lawyers.

The defendants, current and former Tesla directors, denied wrongdoing and said McCormick misinterpreted the facts and the law.

Dexit

Tesla argued in Dover, Delaware that the five justices on Delaware’s high court had three avenues to reverse the lower court ruling.

They could find that Musk, who owned 21.9 percent of Tesla stock in 2018, did not control the board pay negotiations and that shareholders were fully informed when they voted to approve it that year. They could determine that rescinding the pay was an improper remedy because it did not undo the work that Musk had done or the gains that shareholders had received. Or they could determine that last year’s vote demonstrated shareholders wanted to accept the pay deal, despite the legal flaws.

“Shareholders in 2024 knew exactly what they were voting for,” Wall said.

Greg Varallo, an attorney for Richard Tornetta, the small investor who brought the case in 2018, said if the court accepted ratification, it would allow a party to change the outcome after a court case had run its course. “Lawsuits would be interminable”, he told the justices.

Varallo tried to convince the justices the lower court ruling was a result of careful fact-finding and based on settled law. “There is nothing extraordinary about this trial opinion,” he said. “What makes it truly extraordinary is that it addresses the largest pay package in human history, awarded to the richest man on earth, who is also one of the most powerful men on earth.”

After the Musk pay ruling, large companies, including Tesla, Dropbox, and the venture capital firm Andreessen Horowitz, switched their legal homes to Texas or Nevada, where courts are friendlier toward directors. Delaware lawmakers responded to the corporate departures, a trend known as “Dexit,” by overhauling its corporate law.

If Musk loses the appeal, he will still reap tens of billions of dollars in stock from the electric vehicle (EV) company, which agreed in August to a replacement deal if his 2018 plan is not restored. Tesla has said the replacement plan will cost $25bn or more in accounting charges.

The company said the replacement award was meant to focus the attention of Musk, who said earlier this year that he was forming a new US political party, on transitioning Tesla to robotics and automated driving. Tesla is now incorporated in Texas, where it is far more difficult for a shareholder to challenge board decisions.

New pay plan

Tesla’s board last month proposed a $1 trillion compensation plan, highlighting confidence in Musk’s ability to steer the company in a new direction, even as Tesla loses ground to Chinese rivals in key markets amid softening EV demand.

The justices are considering the appeal of the pay ruling as well as the $345m legal fee that McCormick ordered Tesla to pay to the attorneys for Tornetta, who held just nine Tesla shares when he sued to block the pay deal. The court typically takes months to rule.

Tesla estimated in 2018 that the stock options plan would be worth $56bn if the company met operational and financial goals, which it did. Because the stock continued to appreciate, the options are currently worth closer to $120bn, by far the largest executive compensation ever. Musk is the world’s richest person with a fortune of around $480bn, according to Forbes.

The defendants have argued that McCormick erred in finding social and business ties to Musk compromised their independence, and said Tesla shareholders were informed of the economic terms of the pay deal before they approved the plan. The directors said she should have reviewed the pay package under the “business judgment” standard, which protects directors from second-guessing by courts.

The directors have long argued the pay package performed as hoped – it focused the attention of Musk, a serial entrepreneur, and he transformed Tesla from a startup into one of the world’s most valuable companies.

Last month, US President Donald Trump had said he would introduce new tariffs to protect the manufacture of medium- and heavy-duty trucks from outside competition.

United States President Donald Trump has said that all medium- and heavy-duty trucks imported into the country will face a 25 percent tariff rate starting November 1, a significant escalation of his effort to protect US companies from foreign competition.

Trump made the announcement on Monday.

Last month, Trump had said heavy truck imports would face new duties on October 1 on national security grounds, saying the new tariffs were to protect manufacturers from “unfair outside competition” and that the move would benefit companies such as Paccar-owned Peterbilt and Kenworth and Daimler Truck-owned Freightliner.

Under trade deals reached with Japan and the European Union, the US has agreed to 15 percent tariffs on light-duty vehicles, but it is not clear if that rate will be set for larger vehicles.

The Trump administration has also allowed producers to deduct the value of US components from tariffs paid on light-duty vehicles assembled in Canada and Mexico.

Larger vehicles include trucks for delivery, garbage pickup, and public utilities; buses for transit, shuttles, and schools; tractor-trailer trucks; semitrucks; and heavy-duty vocational vehicles.

Impact on allies

The US Chamber of Commerce earlier urged the US Commerce Department not to impose new truck tariffs, noting the top five import sources are Mexico, Canada, Japan, Germany, and Finland, “all of which are allies or close partners of the United States posing no threat to US national security”.

Mexico is the largest exporter of medium- and heavy-duty trucks to the US. A study released in January said imports of those larger vehicles from Mexico have tripled since 2019 to around 340,000 today, according to government statistics.

Under the United States-Mexico-Canada Agreement (USMCA) trade deal, medium- and heavy-duty trucks move free of tariffs if at least 64 percent of a heavy truck’s value originates in North America, via parts like engines and axles, raw materials such as steel, or assembly labour.

Tariffs could also affect Chrysler’s parent company Stellantis, which produces heavy-duty Ram trucks and commercial vans in Mexico. Stellantis had been lobbying the White House not to impose steep tariffs on its Mexican-made trucks.

Sweden’s Volvo Group is building a $700m heavy-truck factory in Monterrey, Mexico, due to start operations in 2026.

Mexico is home to 14 manufacturers and assemblers of buses, trucks, and tractor trucks, and two manufacturers of engines, according to the US International Trade Administration.

Mexico opposed new tariffs, telling the US Commerce Department in May that all Mexican trucks exported to the US have on average 50 percent US content, including diesel engines.

Last year, the US imported almost $128bn in heavy vehicle parts from Mexico, accounting for approximately 28 percent of total US imports, Mexico said.

Canadian PM Carney also announced a fund of $5 billion in Canadian dollars ($3.6bn US) to help firms in all sectors hurt by tariffs.

Canada will waive a requirement that 20 percent of all vehicles sold next year be emissions-free, part of an aid package designed to help companies deal with damage done by tariffs from United States President Donald Trump.

Prime Minister Mark Carney made the announcement on Friday.

The 20 percent target was mandated by the Liberal government of then-Prime Minister Justin Trudeau in 2023.

Carney, Trudeau’s successor, said waiving the rule would help the industry deal with punitive US measures that are also targeting the steel and aluminium sectors.

“This will provide immediate financial relief to automakers at a time of increased pressures on economic competitiveness,” Carney told a televised press conference.

Ottawa will also launch an immediate 60-day review to reduce costs linked to the EV sales requirement.

The Canadian Vehicle Manufacturers’ Association welcomed the move, saying the push for mandates imposed unsustainable costs on companies and threatened investment.

Carney said it was too soon to draw any conclusions about whether Ottawa should lift the 100 percent tariffs it imposed on Chinese-made electric vehicles last year. China on Friday prolonged a probe into imports of canola from Canada, one of the world’s leading suppliers.

Carney, who won an April election on the need to diversify the economy away from the US, said Ottawa would set up a new fund worth $5 billion Canadian dollars ($3.6bn US) with flexible terms to help firms in all sectors affected by tariffs.

The US measures are “causing extreme uncertainty that is holding back massive amounts of investment”, he said.

Ottawa will introduce a new policy to ensure the federal government buys from Canadian suppliers and is also introducing a new biofuel production incentive, with more than $370 million Canadian dollars ($267m US) for farmers to address immediate competitiveness challenges.

Carney did not mention specific new aid for the steel and aluminium sectors. When pressed, he said companies could apply for help from existing funds.

After a wave of rushed buying, driven by looming tariffs, US car sales have started to slow, weighing on carmakers.

New car sales fell by 300,000 in June from 15.6 million to 15.3 million, according to data released by Cox Automotive last month.

“Now we’ve got sales slowing because [the pre-tariff buying] surge pretty much pulled ahead a lot of people that might have been in the market this year, who wanted to buy before tariffs hit,” Mark Schirmer, director of industry insights at Cox Automotive, told Al Jazeera.

This will only get harder for carmakers, dealerships and shoppers down the road.

“Price rises together with demand destruction,” Sina Golara, assistant professor of supply chain management at Georgia State’s Robinson College of Business, told Al Jazeera. “If consumers don’t have the resilience to pay for those higher prices, they’ll take a step back.”

United States President Donald Trump’s erratic approach to tariffs, putting some in place and then taking them away, has made it difficult for businesses to plan. In April, car companies, including Stellantis, Ford and Volvo, suspended financial guidance as a result of the uncertainty.

Last month Volvo also said that tariffs will cost it $1.2bn in the second quarter. Ford then announced it expects a reduced annual profits to $3bn after taking an $800m hit from tariffs in the second quarter. GM announced that it expects a $5bn hit, and Toyota said it expects $9.5bn in tariff-driven blows to profits for the year.

In May, Ford also announced it would have to raise prices on some of its cars made in Mexico, including the Mustang Mach-E electric SUV, Maverick pick-up truck and Bronco Sport, in some cases by as much as $2,000, the Reuters news agency reported. Those cars began to reach lots last month.

As a result, consumers are overwhelmingly opting for used cars that are not subject to tariffs, including foreign-made ones, as they are already on US roads.

Used car sales are up 2.3 percent from this time last year, according to Used Car Index report, an auto industry insight platform by Edmunds.

In part, this is because of the limited supply of used cars. Edmunds’s report says that buyers, and sellers looking to upgrade but need the money from sale of a current car, are hesitant about undertaking expenses amid economic uncertainty.

The bigger impact of both those trends is of inventory piling up. On average, dealerships have 82 days worth of cars on the lot, a roughly 14 percent increase between May and June.

An expensive escalation

Cox forecasts prices could rise anywhere between 4 to 8 percent over the next six months as a result of the tariffs. The group expects new car sales of 13 million to 13.3 million this year.

“Tariffs will be inflationary on both the new and used vehicle market,” Schirmer said, adding, the main challenge right now is the unsold inventory that’s piling up.

Analysts believe that prices will continue to rise amid Trump’s tariffs, especially as companies try to move supply chains to the US, as demanded by Trump, an effort that is years in the making.

“The tariff ‘relief’ is like putting a band-aid on a bullet wound with US car companies now dealing with the repercussions moving forward as this Twilight Zone situation will change the paradigm for the US auto industry for years to come,” Dan Ives, analyst at Wedbush Securities, said in a note provided to Al Jazeera.

In the meantime, the cost to import a car is expected to increase by $1,000 this year to $5,700, according to Cox Automotive.

“The US imports a little less than half of the new vehicles sold, but dependence on imports varies substantially by segment. The most dependent segments are at the two ends of the price spectrum – the most affordable vehicles and luxury vehicles. Most of the vehicles priced under $30,000 would face added costs that would make them unaffordable,” Cox Automotive chief economist Jonathan Smoke said in a June conference call shared with Al Jazeera.

EVs hit hard

Trump’s new tax legislation – signed into law last month and which cut the EV tax credit of up to $7,500 – has already led to a significant pullback specifically for the electric vehicle marketplace as demand for the products begins to fall.

“Our forecast had been for approximately 10 percent of new vehicle sales this year to be EV. We slightly lowered that to 9 percent,” Schirmer added.

Volvo reported a 26 percent decline in sales for electric vehicles (12 percent overall). Ford EV sales tumbled by 31 percent. Rivian saw sales decline by 23 percent. Tesla saw a decline of 13.5 percent globally as CEO Elon Musk’s political involvement hindered the brand’s reputation. The cuts to the EV tax credit is expected to cost Tesla $1.2bn every year, JP Morgan forecast.

“Several dealers have also stated that these [EV tax credits] are the main drivers [for consumers]. So without those incentives, there would definitely be a significant hit through EV sales,” Golara added.

General Motors has been the exception to the rule. The Michigan-based auto giant doubled its EV sales in recent months.

Despite the dip in sales, Golora believes that the setback in the EV market is temporary.

“It’s [the EV market] still compelling in the long run because many manufacturers have already reached a decision that this is where the industry is going,” Golara said.

“Investment [in EV production] doesn’t look like a lost one. The payback period will be longer.”

Manufacturing strains

While US manufacturing ticked up overall in June, when it comes to motor vehicle and parts production, it is a different story. Production tumbled by 2.6 percent for the month as demand began to slow.

US auto manufacturing employment is also down. According to the Bureau of Labor Statistics, employment in auto manufacturing in the United States has tumbled by 35.7 percent since this time last year and down 2.4 percent from this time last month.

Al Jazeera reached out to the United Auto Workers for comment about the effect on car manufacturing jobs, but the organisation did not respond.

“Demand was not growing as fast as needed, and many manufacturers were caught by surprise. That’s a problem, and it is kind of a longer-term, structural issue,” Golara said.

The world’s top-selling carmaker joins a growing list of companies reporting profit hits because of tariffs

Toyota expects a $9.5bn hit from United States President Donald Trump’s tariffs on cars imported to the US, the largest of any company to date, underscoring growing margin pressures.

The world’s top-selling carmaker announced the forecast impact alongside its updated annual guidance on Thursday.

Toyota also cut its forecast for full-year operating profit by 16 percent, reflecting challenges for global manufacturers grappling with rising costs from US levies on cars, parts, steel and aluminium.

“It’s honestly very difficult for us to predict what will happen regarding the market environment,” Takanori Azuma, Toyota’s head of finance, told a briefing, vowing to keep making cars for US customers, regardless of tariff impact.

Azuma said the 1.4-trillion yen ($9.50bn) estimate also includes fallout that suppliers are facing, particularly those in the US importing parts from Japan, though he declined to say how much of the total was attributable to that.

Toyota’s North American business swung to an operating loss of 63.6 billion yen ($431.3m) in the first quarter, from a profit of 100.7 billion yen ($682.9m) a year earlier, as it took a hit of 450 billion yen ($3bn) from the tariffs.

Its broad production operations, which include US, Canadian, Mexican and Japanese plants, expose it to tariffs not only on direct exports but also on vehicles and parts shipped across borders within North America.

Last week, the automaker said it turned out some 1.1 million Toyota and Lexus brand vehicles in North America in the first six months of 2025, including more than 700,000 in the US.

Forecasts tumble

Toyota cut its operating profit forecast for the financial year to the end of March 2026 to 3.2 trillion yen ($21.7bn) down from a previous outlook of 3.8 trillion yen ($25.7bn).

It had previously estimated a tariff hit of 180 billion yen ($1.2bn) for April and May, but that was solely for the impact from tariffs on Toyota’s vehicles. It had not issued a full-year projection until now.

Rivals have reported smaller tariff hits so far: Jeep maker Stellantis said tariffs were expected to add $1.7bn in expenses for the year. General Motors (GM) has projected one of $4bn to $5bn for the year, while Ford expects a $3bn gross hit to pretax adjusted profit.

On Wednesday, Ford reported that second-quarter results took an $800m hit from tariffs.

Trade deals

The first-quarter results highlight the pressure US import tariffs are putting on Japanese automakers, even as a trade pact between Tokyo and Washington offers potential relief.

Under the deal agreed last month, Japanese auto exports into the US would face a 15 percent tariff, down from levies totalling 27.5 percent previously. But a timeframe for the change has yet to be unveiled.

Last week, Toyota reported record global output and sales for the year’s first half, driven by strong demand in North America, Japan and China, including that for petrol-electric hybrid vehicles.

The carmaker also announced on Thursday a plan to build a new vehicle factory in Japan, where car sales have been falling due to a shrinking population and declining ownership.

Toyota said it planned to start operations early next decade at the new plant, but has yet to decide production models.

On Wall Street, Toyota’s stock is on the decline amid its downward revised forecast. As of 11:30am in New York City (15:30 GMT), it is down by 1.6 percent. Competitors’ stocks are mixed. Ford is down 0.5 percent, Stellantis is up 2.4 percent and GM is up by about 0.7 percent.

Analysts expect a turnaround in future quarters as the automaker bets on robotaxi expansions.

Tesla has reported its biggest decline in quarterly revenue in more than a decade as CEO Elon Musk’s political activity weighs on the electric carmaker brand’s reputation.

Revenue fell to $22.5bn for the April-June quarter from $25.5bn a year earlier, according to its earnings report, which Tesla released after the closing bell on Wall Street. Analysts on average were expecting revenue of $22.74bn, according to data compiled by LSEG.

Revenue from car sales declined by 16 percent. Tesla attributed the revenue dip to a decline in vehicle deliveries. Earlier this month, it reported a 14 percent decline in car deliveries in the second quarter.

Investors are worried about whether Musk will be able to give enough time and attention to Tesla after he locked horns with United States President Donald Trump by forming a new political party this month. Weeks earlier, he had promised that he would cut back on government work and focus on his companies.

Musk’s connections to the Trump administration and layoffs across the US government when he headed the Department of Government Efficiency weighed on its US reputation. Meanwhile, the billionaire’s endorsements of the far-right AfD party in Germany have affected the brand’s reputation in Europe.

A series of high-profile executive exits, including last month of a longtime Musk confidant who oversaw sales and manufacturing in North America and Europe, is also adding to the concerns.

The company reported a second straight quarterly revenue drop, despite rolling out a much-awaited refreshed version of its best-selling Model Y SUV that investors had hoped would rekindle demand.

Much of the company’s trillion-dollar valuation hangs on its bet on its robotaxi service – a small trial of which started in Austin, Texas, last month – and developing humanoid robots. On Wednesday, Bloomberg News reported that Tesla has been in talks with the state of Nevada about introducing robotaxi services there.

Analysts believe that this will keep the automaker on pace for growth in future quarters.

“We are at a ‘positive crossroads’ in the Tesla story: Musk is laser focused as CEO, Robotaxi/autonomous expansion has begun, demand stabilisation has begun especially in China, and Tesla is about to embark on an aggressive AI-focused strategy that, we believe, will include owning a significant piece of xAI,” Dan Ives, an analyst at the financial services company Wedbush Securities, said in a note provided to Al Jazeera.

xAI is Musk’s AI firm which also makes the chatbot Grok.

“While near-term and this quarter the numbers are nothing to write home about, we believe investors are instead focused on the AI future at Tesla, with a motivated Musk back driving Tesla’s future,” Ives said.

Tesla’s stock closed the trading day in positive territory, up by 0.1, but has tumbled in after-hours trading, down by 0.3 percent.

GM’s profit tumble in second quarter comes a day after Jeep maker Stellantis says it expected a $2.7bn loss in the first six months of the year.

Auto giant General Motors has reported a 35 percent drop in second-quarter profits, including a $1.1bn hit from United States-imposed tariffs but confirmed its full-year forecast.

GM’s results released on Tuesday still topped analyst estimates, but the US carmaker cautioned that profits in the second half of 2025 would be lower than in the first.

The company pointed to sales growth in North America, where new and revamped trucks and sport utility vehicles sold briskly with solid pricing. GM was among the carmakers that benefitted from a surge in demand this spring from consumers who wanted to beat the US tariffs and their higher prices.

Profits overall fell 35.4 percent to $1.9bn year-on-year while revenues dipped 1.8 percent to $47.1bn.

The US imposed 25 percent tariffs on imported finished cars in early April, a move that affected major GM manufacturing operations in Mexico, Canada and South Korea. Car companies have also faced tariffs on imported steel, aluminium and auto parts.

The tariff hit in the second quarter reflected that there were “minimal mitigation offsets”, GM said in a slide presentation.

The Detroit, Michigan-based company’s outlook for a weaker second half of 2025 reflects “seasonally lower” volumes, increased spending on vehicle launches and the presence of two quarters with a tariff hit compared with just one in the first half of the year.

GM expected annual operating income of $10bn to $12.5bn after notching $6.5bn in the first half of the year.

Chief Financial Officer Paul Jacobson described the hit to profitability in the first quarter as “the peak of the tariff impact for us”, telling CNBC in an interview that mitigation efforts should enable a partial recovery in profit margins later in the year.

Shifting manufacturing

GM expected to mitigate “at least” 30 percent of the tariff hit through “manufacturing adjustments, targeted cost initiatives and consistent pricing”, according to a slide.

Jacobson said it would take 18 to 24 months to implement capital projects to adjust GM’s manufacturing footprint.

In June, GM announced spending of $4bn over two years to expand production at plants in Michigan, Kansas and Tennessee, making use of unused capacity in its home market as President Donald Trump’s tariffs penalise imports of finished vehicles.

The June announcement included steps to produce the Chevrolet Equinox and Chevrolet Blazer in the US. The two vehicles are currently assembled in Mexico.

GM has so far not shifted manufacturing from South Korea, home to production for the Chevrolet Trax, a popular compact SUV that is priced affordably.

Jacobson told CNBC the Trax has stayed profitable even with the hit from the tariff on imported autos.

“We haven’t made any long-term decisions about Korea yet, mainly because there is a lot of uncertainty about that,” Jacobson said.

Trump has set an August 1 deadline to reach broad trade deals with numerous countries, including South Korea, which faces a 25 percent tariff if there is no deal.

“We’re optimistic that the US and Korea can find common ground,” Jacobson said. “We know the auto industry is important to both sides in those conversations.”

GM’s stock tumbled on the lacklustre earnings report. It is down 6.6 percent for the day as of 11:30am in New York (15:30 GMT).

GM’s newly reported hit comes a day after carmaker Stellantis announced it expected a $2.7bn loss in the first six months of the year because of Trump’s imposed tariffs. Stellantis, the owner of brands including Fiat and Jeep, will disclose its final results for the first half of the year on July 29.

Stellantis stock is down 0.3 percent since the market opened on Tuesday and had increased more than 2.4 percent over the past five days.

Prime Minister Mark Carney also introduced a fund to invest in domestic steel projects.

Canadian Prime Minister Mark Carney has said that Canada will introduce a tariff rate quota on countries it has free trade agreements with, excluding the United States, in order to protect its domestic steel industry.

Carney announced the new measures on Wednesday.

The plan includes a 50 percent tariff that will apply to imports from relevant countries that surpass the 2024 volumes, though Canada will honour existing arrangements with its United States-Mexico-Canada Agreement (USMCA) trade partners, Carney said.

Canada will implement additional tariffs of 25 percent on steel imports from all countries containing steel melted and poured in China before the end of July.

Carney is responding to complaints from the domestic industry, which had said that other countries are diverting steel to Canada and making the domestic industry uncompetitive due to US tariffs. The Canadian steel industry had asked the government to introduce tougher anti-dumping measures to protect the domestic industry.

US President Donald Trump increased import duties on steel and aluminium to 50 percent from 25 percent earlier this month. Canada is the top seller of steel to the US.

Carney also said domestic steel companies would be prioritised in government procurement, and he introduced a fund of one billion Canadian dollars ($730m) to help steel companies advance projects in industries such as defence.

“These measures will ensure Canadian steel producers are more competitive by protecting them against trade diversion resulting from a fast-changing global environment for steel,” Carney said on Wednesday.

For countries without free trade agreements with Canada, the government lowered the tariff-free quota to 50 percent of 2024 volumes from 100 percent previously. Above the quota, imports will also face a 50 percent tariff.

Catherine Cobden, president and CEO of the Canadian Steel Producers Association, in an interview with broadcaster CBC, said the timing wasn’t sufficient for domestic steelmakers confronting a crisis.

“This is something we should have been doing all along, but it’s fantastic to see that we are making progress,” Cobden said.

In a separate statement, Canadian steel maker Evraz said it has filed a complaint against steel imports from Mexico, the Philippines, South Korea, Turkiye and the US, against unfairly priced imports of oil country tubular goods.

The EV maker also opened its first showroom in Mumbai on Tuesday.

Tesla has launched its Model Y in India for about $70,000, a significant markup relative to its other major markets, reflecting the country’s high tariffs on electric vehicle imports, which CEO Elon Musk has long criticised.

The electric carmaker announced the price on Tuesday.

Deliveries are estimated to start from the third quarter, the US automaker is targeting a niche electric vehicle segment in India that accounts for just 4 percent of overall sales in the world’s third-largest car market.

It will compete mainly with German luxury giants such as BMW, Mercedes-Benz and South Korea’s Kia rather than domestic mass-market EV players such as Tata Motors and Mahindra Auto.

On Tuesday, Tesla opened its first showroom in Mumbai and began taking Model Y orders on its website, marking its long-awaited entry into the market where Musk once had plans to open a factory.

For now, Tesla will import cars into a country where tariffs and related duties can exceed 100 percent, driving up the price for consumers.

Tesla’s Model Y rear-wheel drive is priced at about $70,000 (6 million rupees), while its Model Y long-range rear-wheel drive costs roughly $79,000 (6.8 million rupees), according to the website.

Tariff pressures

The prices include the tariff and additional levies imposed by the state. There was no breakdown of the price on the website and Reuters could not immediately ascertain the listing price.

They compare with a starting price from $44,990 in the US, $36,700 (263,500 yuan) in China, and $53,700 (45,970 euros) in Germany.

At the media-only event at the showroom, Tesla displayed two Model Y cars made in China and its supercharger, which it will install at eight different locations in Mumbai and in and around New Delhi, where it is also expected to open its next showroom.

“We are here to create the ecosystem, to invest in the necessary infrastructure, including the charging infrastructure,” Isabel Fan, a regional director at Tesla, said at the launch event.

“We are building from 0 to 100. It will take time to cover the whole country.”

Grappling with excess capacity in global factories and declining sales, Tesla has adopted a strategy of selling imported vehicles in India, despite the duties and levies.

The US EV maker has long lobbied India for lower import tariffs on cars, and Prime Minister Narendra Modi’s officials remain in talks with US President Donald Trump’s administration to lower the levies under a bilateral trade deal.

Tesla’s US factories also do not currently make the right-hand drive vehicles that are used in India.

Although India’s road infrastructure has improved, traffic discipline – like lane driving – is still rudimentary, EV chargers are far and few and stray animals, including cattle, and potholes on the road are a big hurdle, even in cities.

“In the future, we wish to see R&D and manufacturing done in India, and I am sure at an appropriate stage, Tesla will think about it,” Maharashtra Chief Minister Devendra Fadnavis told reporters outside the new Tesla outlet.

Musk’s political ambition has spooked investors as the auto company reports a decrease in sales in the second quarter.

Tesla shares have tumbled after CEO Elon Musk announced plans to launch a new US political party amid his ongoing feud with his longtime ally, United States President Donald Trump.

Shares of the electric automaker are down 7 percent as of 12pm in New York (16:00 GMT) on Monday. Musk announced his plans on Friday to launch a new political party after disagreements with the president over the tax legislation signed into law the same day. Trump has called the idea “ridiculous”.

Musk’s announcement has fuelled further concerns amongst analysts about his dedication to the automaker after it reported a sales decline in the second quarter driven by Musk’s political involvement.

Trump-Musk conflict weighs on investors 

“Very simply, Musk diving deeper into politics and now trying to take on the Beltway establishment is exactly the opposite direction that Tesla investors/shareholders want him to take during this crucial period for the Tesla story,” Dan Ives, analyst at Wedbush Securities, said in a note. “While the core Musk supporters will back Musk at every turn no matter what, there is a broader sense of exhaustion from many Tesla investors that Musk keeps heading down the political track.”

“After leaving the Trump Administration and DOGE [the US Department of Government Efficiency], there was initial relief from Tesla shareholders and big supporters of the name that Tesla just got back its biggest asset, Musk. That relief lasted a very short time and now has taken a turn for the worse with this latest announcement.”

Last week, Trump had threatened to cut off the billions of dollars in subsidies that Musk’s companies receive from the federal government after their feud erupted into an all-out social media brawl in early June.

“I, and every other Tesla investor, would prefer to be out of the business of politics. The sooner this distraction can be removed and Tesla gets back to actual business, the better,” Camelthorn Investments adviser Shawn Campbell, who owns Tesla shares, told the Reuters news agency.

Tesla is set to lose more than $80bn in market valuation if current losses hold, while traders are set to make about $1.4bn in paper profits from their short positions in Tesla shares on Monday.

Musk’s latest move also raises questions around the Tesla board’s course of action. Its chair, Robyn Denholm, in May denied a Wall Street Journal report that said board members were looking to replace the CEO.

Tesla’s board, which has been criticised for failing to provide oversight of its combative, headline-making CEO, faces a dilemma managing him as he oversees five other companies and his personal political ambitions.

“This is exactly the kind of thing a board of directors would curtail – removing the CEO if he refused to curtail these kinds of activities,” said Ann Lipton, a professor at the University of Colorado Law School and an expert in business law.

The company’s shares and its future are seen as inextricably tied to Musk, the world’s richest man, whose wealth is constituted significantly of Tesla stock. He is Tesla’s single largest shareholder, according to data from the London Stock Exchange Group (LSEG).

“The Tesla board has been fairly supine; they have not, at least not in any demonstrable way, taken any action to force Musk to limit his outside ventures, and it’s difficult to imagine they would begin now,” Lipton added.

Other companies tied to Musk – including X Corp, formerly Twitter, and SpaceX – are not publicly traded.

China’s export of rare earth elements is central to the trade deal struck this week with the United States.

Beijing has a virtual monopoly on the supply of the critical minerals, which are used to make everything from cars to drones and wind turbines.

Earlier this year, Beijing leveraged its dominance of the sector to hit back at US President Donald Trump’s sweeping tariffs, placing export controls on seven rare earths and related products.

The restrictions created a headache for global manufacturers, particularly automakers, who rely on the materials.

After talks in Geneva in May, the US and China announced a 90-day pause on their escalating tit-for-tat tariffs, during which time US levies would be reduced from 145 percent to 30 percent and Chinese duties from 125 percent to 10 percent.

The truce had appeared to be in jeopardy in recent weeks after Washington accused Beijing of not moving fast enough to ease its restrictions on rare earths exports.

After two days of marathon talks in London, the two sides on Wednesday announced a “framework” to get trade back on track.

Trump said the deal would see rare earth minerals “supplied, up front,” though many details of the agreement are still unclear.

What are rare earths, and why are they important?

Rare earths are a group of 17 elements that are essential to numerous manufacturing industries.

The auto industry has become particularly reliant on rare-earth magnets for steering systems, engines, brakes and many other parts.

China has long dominated the mining and processing of rare earth minerals, as well as the production of related components like rare earth magnets.

It mines about 70 percent of the world’s rare earths and processes approximately 90 percent of the supply. China also maintains near-total control over the supply of heavy rare earths, including dysprosium and terbium.

China’s hold over the industry had been a concern for the US and other countries for some time, but their alarm grew after Beijing imposed export controls in April.

The restrictions affected supplies of samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium, and required companies shipping materials and finished products overseas to obtain export licences.

The restrictions followed a similar move by China in February, when it placed export controls on tungsten, bismuth and three other “niche metals”.

While news of a deal on rare earths signals a potential reprieve for manufacturers, the details of its implementation remain largely unclear.

What has been the impact of the export restrictions?

Chinese customs data shows the sale of rare earths to the US dropped 37 percent in April, while the sale of rare earth magnets fell 58 percent for the US and 51 percent worldwide, according to Bloomberg.

Global rare earth exports recovered 23 percent in May, following talks between US and Chinese officials in Geneva, but they are still down overall from a year earlier.

The greatest alarm has been felt by carmakers and auto parts manufacturers in the US and Europe, who reported bottlenecks after working their way through inventories of rare earth magnets.

“The automobile industry is now using words like panic. This isn’t something that the auto industry is just talking about and trying to make a big stir. This is serious right now, and they’re talking about shutting down production lines,” Mark Smith, a mining and mineral processing expert and the CEO of the US-based NioCorp Developments, told Al Jazeera.

Even with news of a breakthrough, Western companies are still worried about their future access to rare earths and magnets and how their dependence on China’s supply chain could be leveraged against them.

The Financial Times reported on Thursday that China’s Ministry of Commerce has been demanding “sensitive business information to secure rare earths and magnets” from Western companies in China, including production details and customer lists.

What have the US and China said about rare earth exports?

Trump shared some details of the agreement on his social media platform, Truth Social, where he also addressed concerns about rare earths and rare earth magnets.

“We are getting a total of 55% tariffs, China is getting 10%. The relationship is excellent,” Trump said, using a figure for US duties that includes levies introduced during his first term.

“Full magnets, and any necessary rare earths, will be supplied, up front, by China. Likewise, we will provide to China what was agreed to, including Chinese students using our colleges and universities (which has always been good with me),” Trump said.

Ahead of the negotiations in London, China’s Ministry of Commerce had said it approved an unspecified number of export licences for rare earths, and it was willing to “further strengthen communication and dialogue on export controls with relevant countries”.

However, an op-ed published by state news outlet Xinhua this week said rare earth export controls were not “short-term bargaining tools” or “tactical countermeasures” but a necessary measure because rare earths can be used for both civilian and military purposes.

NioCorp Developments’ Smith said Beijing is unlikely to quickly give up such powerful leverage over the US entirely.

“There’s going to be a whole bunch of words, but I really think China is going to hold the US hostage on this issue, because why not?” he said.

“They’ve worked really hard to get into the position that they’re in. They have 100 percent control over the heavy rare earth production in the world. Why not use that?”

Deborah Elms, the head of trade policy at the Hinrich Foundation in Singapore, said it was hard to predict how rare earths would be treated in negotiations, which would need to balance other US concerns like China’s role in exporting the deadly opioid fentanyl to the US.

Beijing, for its part, will want guarantees that it can access advanced critical US technology to make advanced semiconductors, she said.

The mandate that the DoT challenged was a key part of former US President Joe Biden’s plan to address climate change.

The United States Department of Transportation (DoT) has declared that former President Joe Biden’s administration exceeded its authority by assuming a high uptake of electric vehicles in calculating fuel economy rules.

With that declaration on Friday, the DoT paved the way for looser fuel standards and published the “Resetting the Corporate Average Fuel Economy Program” (CAFE) rule. A future separate rule from the administration of President Donald Trump will revise the fuel economy requirements.

“We are making vehicles more affordable and easier to manufacture in the United States. The previous administration illegally used CAFE standards as an electric vehicle mandate,” Transportation Secretary Sean Duffy said in a statement.

The department’s National Highway Traffic Safety Administration (NHTSA), in writing its rule last year under Biden, had “assumed significant numbers of EVs would continue to be produced regardless of the standards set by the agency, in turn increasing the level of standards that could be considered maximum feasible,” it said Friday.

A shift away from Biden policies 

In January, Duffy signed an order directing NHTSA to rescind fuel economy standards issued under Biden for the 2022-2031 model years that had aimed to drastically reduce fuel use for cars and trucks.

In a release last year, the DoT, then led by Pete Buttigieg, put in place a required fuel economy to increase by 2 percent for cars made between 2027 and 2031.

At the time, the DoT said it would help save consumers upwards of $600 on gas every year. It was also part of the Biden administration’s plan to address climate change.

“These new fuel economy standards will save our nation billions of dollars, help reduce our dependence on fossil fuels, and make our air cleaner for everyone. Americans will enjoy the benefits of this rule for decades to come,” then NHTSA Deputy Administrator Sophie Shulman said at the time.

In June 2024, the NHTSA said it would hike CAFE requirements to about 50.4 miles per gallon (4.67 litres per 100km) by 2031 from 39.1mpg currently for light-duty vehicles.

The agency last year said the rule for passenger cars and trucks would reduce gasoline consumption by 64 billion gallons and cut emissions by 659 million metric tons, cutting fuel costs with net benefits estimated at $35.2bn.

Late on Thursday, Senate Republicans proposed eliminating fines for failures to meet CAFE rules as part of a wide-ranging tax bill, the latest move aimed at making it easier for automakers to build gas-powered vehicles.

Last year, Chrysler-parent Stellantis paid $190.7m in civil penalties for failing to meet US fuel economy requirements for 2019 and 2020 after paying nearly $400m for penalties from 2016 through 2019. GM previously paid $128.2m in penalties for 2016 and 2017.

Stellantis said it supported the Senate Republican proposal “to provide relief while DoT develops its proposal to reset the CAFE standards … The standards are out of sync with the current market reality, and immediate relief is necessary to preserve affordability and freedom of choice.”

GM declined to comment.

The tech billionaire and owner of Tesla and Starlink, Elon Musk, has accused United States President Donald Trump of being one of the names in the still-sealed Epstein files, and claims that this is the real reason key documents are still being withheld from the public.

In January 2024, many of the so-called “Epstein files” compiled by US federal investigators were released to the public. However, some remained sealed.

Trump’s presidency began with a strong boost from Musk, who donated large sums to Trump’s presidential campaign and was appointed to lead a newly formed federal agency aimed at streamlining government operations, the Department of Government Efficiency (DOGE).

But that relationship fractured after Musk resigned from the role in May 2025, following mounting public backlash over fiscal policies and a sharp decline in Tesla’s stock.

Since then, Musk has become increasingly vocal in his criticism of Trump, calling his “One Big Beautiful Bill” a “disgusting abomination” for increasing the national debt and eliminating electric vehicle subsidies, and, now, accusing him of links to Epstein.

Here’s what we know about the Epstein files and Musk’s accusations.

What are the Epstein files?

The “Epstein files” are a collection of documents compiled by US federal authorities during investigations into the activities of Jeffrey Epstein, the now-deceased financier and convicted sex offender.

These files include flight logs, contact lists, court records and other materials documenting his activities and associations with high-profile individuals.

The first major release of the documents took place in January 2024, when a federal judge ordered the unsealing of records from a 2015 defamation lawsuit against Epstein’s associate, Ghislaine Maxwell.

In February 2025, the Department of Justice and Federal Bureau of Investigation (FBI) followed up with an official declassification of additional documents, many of which had already leaked, featuring redacted flight logs and contact books.

However, many documents remain sealed or heavily redacted, prompting public calls for full disclosure.

US Attorney General Pamela Bondi stated that the FBI is reviewing tens of thousands of documents, with further releases pending necessary redactions to protect victims and ongoing investigations.

What has Musk said about the Epstein files?

On Thursday, Musk publicly accused President Donald Trump of being named in the unreleased Epstein files.

In a post on his social media platform X, Musk wrote: “@realDonaldTrump is in the Epstein files. That is the real reason they have not been made public.” He did not provide any evidence to support this claim.

Time to drop the really big bomb:@realDonaldTrump is in the Epstein files. That is the real reason they have not been made public.

Have a nice day, DJT!

— Elon Musk (@elonmusk) June 5, 2025

Has Trump responded?

Trump has not directly addressed Musk’s claim regarding the Epstein files.

However, during a meeting with German Chancellor Friedrich Merz at the White House on Thursday, Trump said he was “very disappointed” by Musk’s criticism of the fiscal bill and suggested that Musk’s opposition was down to the elimination of electric vehicle subsidies.

“Elon was ‘wearing thin,’ I asked him to leave, I took away his EV Mandate that forced everyone to buy Electric Cars that nobody else wanted (that he knew for months I was going to do!), and he just went CRAZY!” Trump wrote in a social media post on Thursday.

Trump also threatened to terminate federal contracts and subsidies for Musk’s companies, including Tesla and SpaceX, stating that this would save the US government billions of dollars.

What do we know about Trump’s relationship with Epstein?

Trump and Epstein were acquaintances in the 1980s and 1990s, often seen at social occasions together in New York and Palm Beach, Florida. Their appearances together were documented in news coverage and social pages at the time, while US media reported the two became close during the 1990s when Epstein bought a mansion near Trump’s Mar-a-Lago compound in Palm Beach.

A 1992 video published by NBC News shows Trump and Epstein socialising and watching dancers at a party hosted at Mar-a-Lago.

In a 2002 profile of Epstein by New York Magazine, Trump was quoted describing Epstein as a “terrific guy” who enjoyed the company of beautiful women “on the younger side”.

“I’ve known Jeff for 15 years. Terrific guy. He’s a lot of fun to be with. It is even said that he likes beautiful women as much as I do, and many of them are on the younger side,” Trump said.

Flight logs released during court proceedings against Maxwell show that Trump flew on Epstein’s private jet at least seven times between 1993 and 1997, occasionally with family members.

Epstein’s “Black Book” – a contact directory obtained in 2015 by Gawker, a now-defunct US blog that covered celebrities and media – was later submitted as court evidence and listed multiple phone numbers and addresses for Trump, including his office, home and Mar-a-Lago.

What happens now?

Once allies, Musk’s relationship with Trump has deteriorated significantly since his criticism of Trump’s fiscal policy and subsequent allegations about the Epstein files.

Trump’s threats to cut federal contracts with Musk’s companies led to a 14 percent drop in Tesla’s stock value. Musk has since called for Trump’s impeachment and replacement with US Vice President JD Vance.

This public spat has also drawn attention from political figures, with some Democrats demanding the release of the full Epstein files and questioning whether they are being withheld due to potential implications for Trump.

Labour prosecutors allege that workers were brought to Brazil illegally and toiled in ‘slavery-like conditions’.

Brazilian labour prosecutors have filed a lawsuit against the Chinese auto manufacturer BYD and two contractors over allegations of illegally trafficking labourers to live and work under conditions “analogous to slavery”.

On Tuesday, the prosecutors, charged with enforcing labour laws, said in a statement that they would seek 257 million reais ($45m) in damages from BYD as well as contractors China JinJiang Construction Brazil and Tecmonta Equipamentos Inteligentes.

They accused the three companies of trafficking Chinese workers to build a BYD plant in Camacari, in the northeastern state of Bahia. There, the prosecutors allege that the companies subjected the workers to “extremely degrading” conditions.

“In December last year, 220 Chinese workers were found to be in conditions analogous to slavery and victims of international human trafficking,” the statement said.

The damages the prosecutors are seeking amount to a penalty of 50,000 reais ($8,867) per violation, multiplied by the number of workers affected, in addition to moral damages.

The lawsuit is the result of a police raid in December 2024, during which authorities say they “rescued” 163 Chinese workers from Jinjiang and 57 from Tecmonta.

The prosecutors say the workers were victims of international human trafficking and were brought to Brazil with visas that did not fit their jobs.

They also allege that conditions at the construction site left the labourers almost totally dependent on their employers, by withholding up to 70 percent of their wages and imposing high contract termination costs. Some of the workers even had their passports taken away, limiting their ability to leave, according to the prosecutors.

The lawsuit also describes meagre living conditions, including some beds without mattresses.

“In one dormitory, only one toilet was identified for use by 31 people, forcing workers to wake up around 4am to wash themselves before starting their workday,” the prosecutors’ statement notes.

Brazil is the largest market for BYD outside China. The Chinese auto giant has said that it is committed to human rights, is cooperating with authorities and will respond to the lawsuit in court.

A spokesman for the company said in December that allegations of poor working conditions were part of an effort to “smear” China and Chinese companies.

But the Brazilian labour prosecutors rejected the notion that their lawsuit was based on anti-Chinese sentiment.

“Our lawsuit is very well-founded, with a substantial amount of evidence provided during the investigation process,” deputy labour prosecutor Fabio Leal said in an interview.

He stated that the workers, who have all returned to China, would receive any payments related to the lawsuit there, with the companies in Brazil responsible for providing proof of payment.

Elon Musk has claimed a turnaround in Tesla sales after a slump even as Starlink, the internet service provider that he owns, is growing.

Elon Musk has said he is committed to staying on as Tesla’s CEO for at least another five years, weeks after the electric vehicle maker’s chair dismissed reports that the board had approached executive search firms about finding his successor.

Having reasonable control of Tesla was the most important factor in staying on as head of the company, Musk said on Tuesday at an economic forum in Qatar.

“Yes, no doubt about that at all,” Musk said in response to a question on whether he planned to stick around as Tesla CEO.

Earlier this month, Tesla chair Robyn Denholm denied a Wall Street Journal report that said board members had reached out to several executive search firms to find a replacement for Musk.

Musk, who spoke by video at the event in Qatar, said that Tesla had already turned around sales and demand was strong in regions apart from Europe, where the company has faced protests over his political views.

Tesla sales have also slumped in the United States, where there was a nine percent drop in the first three months of 2025, according to the research firm Cox Automotive. That was largely driven by Musk’s political involvement, including leading the US Department of Government Efficiency, which made significant cuts across the federal workforce. As a result, protests ensued and boycotts of Musk-connected businesses unfolded.

Tesla reported a 13 percent drop in first-quarter deliveries. The Tesla chief has said there has been a turnaround.

“We’re now back over a trillion dollars in market cap, so clearly, the market is aware of the situation, so it’s already turned around,” Musk said.

Tesla currently has a market capitalization of $1.08 trillion.

Musk also referred to Chancellor Kathaleen St Jude McCormick, a Delaware judge who stopped a $56bn pay package for Musk, as an “activist who is cosplaying a judge in a Halloween costume”.

Yet he acknowledged his Tesla pay was a part of his consideration about staying with the carmaker, though he also wanted “sufficient voting control” so he “cannot be ousted by activist investors”.

“It’s not a money thing, it’s a reasonable control thing over the future of the company, especially if we’re building millions, potentially billions of humanoid robots,” he added.

This comes as the billionaire said he will spend “a lot less” in political contributions, after pumping $270m into Donald Trump’s successful 2024 US presidential bid.

“In terms of political spending, I’m going to do a lot less in the future,” Musk said, adding that he does not “currently see a reason” to do more.

As of 11am Eastern time (15:00 GMT) Tesla’s stock was up 1.13 percent higher than when the market opened. The stock is down 15 percent for the year.

Starlink grows

Musk also weighed in on the future of the internet service provider Starlink, which he operates. He said that the company might go public at some point in the future, but that there was no rush.

Starlink has expanded rapidly worldwide to operate in more than 70 countries, with a strong focus on further growth in emerging markets such as India.

South Africa’s government plans to offer a workaround of local Black ownership laws to allow Starlink to operate in the country, according to the news agency Bloomberg, which cited three people familiar with the discussions.

The offer would come at a “last-minute” meeting planned for Tuesday night between South African officials and Musk or his representatives, Bloomberg said. South Africa’s President Cyril Ramaphosa and a delegation of government officials arrived in Washington on Monday in a bid to reset strained ties with the US.