Elon Musk’s significant economic connections with China, particularly through Tesla, raise concerns about Beijing’s potential influence on U.S. policies. Despite his admiration for China, Musk’s interests may conflict with former President Trump’s hardline stance. As Tesla thrives in China, Musk’s visits bolster U.S. entrepreneurs’ image, yet the competitive landscape poses risks. With possible negotiations over Tesla’s technology approvals and the evolving U.S.-China relations, Musk’s role in this dynamic remains uncertain amid geopolitical tensions.
The Intersection of Elon Musk’s Business Interests and U.S.-China Relations
Elon Musk, the CEO of Tesla and advisor to former President Donald Trump, has deep economic ties to China. This relationship raises questions about whether Beijing could leverage its influence over Musk to impact U.S. policy towards China.
Musk is known for his enthusiastic praise of Trump on his social media platform X, highlighting the American public’s excitement over recent polling numbers. However, this post is not accessible in China due to the platform being blocked, along with many other Western social media sites.
Despite this, Musk has been vocal in his admiration for China, complimenting its efficiency, high-speed rail systems, and the industrious nature of its people. This admiration stands in stark contrast to Trump’s critical stance towards Beijing, who has taken a hardline approach, including significant tariffs on Chinese imports during his presidential campaign.
Musk’s visits to China are not merely business trips; they are significant from a political perspective, enhancing the image of U.S. entrepreneurs in the eyes of the Chinese government.
Economic Ties with China
Musk’s financial interests in China are immense, particularly with Tesla relying heavily on this market. In 2024, Tesla sold 657,000 vehicles in China, marking an increase of over eight percent from the previous year, even as global sales saw a decline.
Tesla has played a pivotal role in popularizing electric vehicles in China, significantly contributing to the local economy through the establishment of supply chains. The company’s Gigafactory in Shanghai is a key player, producing nearly half of Tesla’s global deliveries.
The project’s success was backed by the former party secretary of Shanghai, Li Qiang, who supported the initiative, leading to the factory’s completion in 2019. Li now serves as the Premier of China, illustrating the deep connections between Musk’s ventures and Chinese political dynamics.
However, Musk has indicated that Tesla’s rapid growth phase may be behind them, cautioning about the competitive edge that Chinese manufacturers are gaining in the electric vehicle sector.
Admiring Chinese Success and Its Implications
Musk, whose wealth is largely derived from his stake in Tesla, has publicly commended the Chinese leadership, predicting that China will soon become ‘the largest economy in the world.’ Premier Li has also recognized Tesla’s achievements in China as a model of cooperation between the two nations.
Musk’s innovative spirit has garnered him a substantial fan base in China, where his business philosophy and achievements resonate well. His biography enjoys widespread popularity, contributing to his celebrity status in the country.
Additionally, Musk’s mother, Maye, is a notable figure in China, enjoying a significant following on Douyin, the local equivalent of TikTok, where she shares her affinity for the country.
Chinese internet satellite competitor SpaceSail is viewed as a formidable rival to Musk’s SpaceX, indicating the competitive landscape Musk navigates.
Potential Pressure from Beijing
However, tensions exist alongside collaboration. Trump’s ambitions for space exploration, including manned missions to Mars, align with Musk’s own aspirations through SpaceX, which are closely monitored by the Chinese government, given their competitive stance in space technology.
Moreover, there are implications for Musk if China decides to leverage its influence. Tesla is reportedly awaiting approval for its autonomous driving technology in China—a crucial step for future developments in high-tech and AI, and one that could impact Tesla shareholders significantly.
Observers suggest that Beijing could use this approval as a bargaining chip in trade negotiations with the U.S. Business consultant Bill Russo notes that the Chinese leadership may seek reciprocal benefits in exchange for granting these approvals.
Jörg Wuttke, a former BASF executive in China, now advises U.S. companies and suggests that Musk might be pressed to negotiate terms favorable to China.
There are also reports that Beijing is contemplating the sale of TikTok’s U.S. operations to Musk, presenting another layer of complexity to the situation.
Musk’s Influence on U.S.-China Relations
The question remains: can Musk, with his business interests and advisory role, sway relations between the U.S. and China? The ongoing rivalry between the two nations complicates this matter, making predictions challenging.
Scott Kennedy, a China analyst at the Center for Strategic and International Studies in Washington, posits that Musk’s influence may be viewed positively by those advocating for stable relations, particularly within the global business community and among Chinese officials.
However, Wuttke emphasizes that Trump may not consider Musk’s opinions on China matters, as the former president tends to prioritize stock market performance and inflation rates, along with the opinions of Republican congressional members.
Kennedy echoes this sentiment, suggesting that Musk’s potential impact on U.S.-China relations remains as unpredictable as the broader geopolitical climate. If tariffs escalate further, Tesla could also find itself in the crosshairs of Chinese policies.
With both Trump and the Chinese leadership exhibiting unpredictable behavior, the future of their interactions—and Musk’s role within that dynamic—remains to be seen.