Elon Musk starts his trip to China, and the focus is on Tesla’s growth.
Elon Musk, the CEO of Tesla, started a high-stakes trip to China on Tuesday with a meeting with the country’s foreign minister in Beijing. This was his first time back in the biggest production hub for the electric car company in three years.
This is the first time a top US CEO has been back to China since December, when the country reopened its borders and ended its “zero-Covid” policy. Tim Cook from Apple went to China in March. This week, Jamie Dimon from JP Morgan and Laxman Narasimhan from Starbucks are also in China.
Musk met Chinese foreign minister Qin Gang hours after arriving in Beijing.
Qin said to Musk: In a statement from his ministry, he said that China was committed to making it easier for companies, like Tesla, to do business. He also used a complex driving metaphor to describe the relationship between China and the US.
“We must step on the brake at the right time, avoid driving dangerously, and know how to use the accelerator well to promote cooperation that is good for both sides,” Qin said.
The foreign ministry said that Musk said he was ready to grow his business in China and that he didn’t want the US and China economies to be separated. He also said that the two largest economies in the world were like “conjoined twins.”
When asked to comment on Musk’s trip, his schedule, or his meeting with Qin, Tesla did not answer. After the United States, China is Tesla’s second-biggest market.
Musk is also the owner of Twitter. When he went to China, where Twitter is banned but some users can reach it through a virtual private network, he was quiet on Twitter. He also hadn’t written anything on his public Weibo account.
Reuters reported on Monday that he will meet other high-ranking Chinese officials and visit Tesla’s plant in Shanghai. It was not clear who he would meet or what they would talk about.
A source with knowledge of the situation said on Tuesday that a meeting with Zeng Yuqun, the head of CATL, the Chinese battery giant and a key supplier to Tesla, was also planned in Beijing. CATL didn’t answer when asked for a statement.
In March, Reuters said that Musk was going to go to China and wanted to meet with the Chinese Premier, Li Qiang.
During a trip to China in 2019, Musk met with the country’s then-Premier Li Keqiang. A year later, he got a lot of attention on Chinese social media when he danced onstage to celebrate the opening of Tesla’s factory in Shanghai.
Competition is getting tougher for Tesla
Tesla is facing more competition from electric cars made in China, and its plans to expand the Shanghai plant, which is its biggest production hub, aren’t clear.
Investors in Tesla have asked if and by how much the electric car company will grow production in Shanghai.
Daniel Ives, an analyst at the investment company Wedbush, said that he thought Tesla would “aggressively focus on building out its China footprint.”
Even though there is more competition, China’s electric vehicle market, which is the biggest in the world, has become the “golden goose” of EV markets, as he put it.
In a note to investors, he said that Tesla’s Shanghai plant is “the heart and lungs” of the company’s production around the world.
Investors are also worried about whether China’s government will approve the release of Tesla’s advanced driver aid features, which are already available in the US as part of the $15,000 “Full Self Driving” software.
Since Russia invaded Ukraine, Chinese experts have also been interested and worried about Musk’s space company, SpaceX, and how its Starlink satellite network could be used by the military.
Chinese businesses that are owned by the government are rushing to launch their own communications satellites in low-Earth orbit to compete with Starlink. According to study that Reuters looked at, Chinese military researchers have looked into Starlink as a technology that could be dangerous.