Tesla’s China Push: Leaving Elon Musk Vulnerable to Beijing’s Leverage?

Elon Musk’s Vulnerability Exposed by China’s Favors: New York Times

During a recent visit to Shanghai, Tesla CEO Elon Musk was granted special permission by the Chinese government to establish a Tesla plant in the country. However, critics argue that this could leave him vulnerable to leverage from Beijing. The New York Times reported on Musk’s close relationship with China’s government and the concessions offered by Beijing to facilitate the construction of the Tesla plant in Shanghai, which began in 2019.

One of the perks granted to Tesla by China was low-interest loans, while another was a new emissions credit policy that benefited Tesla. Additionally, changes were made to ownership rules that allowed Tesla to set up without a domestic partner. As a result, the Shanghai plant now accounts for over half of Tesla’s global deliveries, making the company increasingly reliant on low production costs in China in a highly competitive electric vehicle market.

With China rapidly building its own strong EV industry, Tesla is facing challenges in the market. US lawmakers have raised concerns about Musk’s dependence on China, particularly considering his ownership of SpaceX, a satellite company with valuable Pentagon contracts. Despite his insistence that his companies are separate entities, Musk has shown support for China on various issues, including Taiwan.

Tesla, SpaceX, and Musk have not provided comment to The New York Times or Business Insider regarding this matter.

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