Elon Musk is against the destruction of economic ties between the US and China

On May 31, Musk met with China’s Minister of Commerce Wang Wentao and China’s Minister of Industry and Informatization Jin Zhuanglong in Beijing. With the former, they discussed Sino-US economic cooperation and the development of Tesla in China, and with the latter, they exchanged views on the development of new energy vehicles and smart cars. Wang stressed that the economies of China and the United States are deeply integrated, and both sides should strengthen economic and trade dialogue and cooperation.

Prior to that, on May 30, Musk had a meeting with Chinese Foreign Minister Qin Gang, according to the website of the Foreign Ministry. On it, the billionaire said that the interests of the United States and China “are inseparable from each other like Siamese twins,” and also noted the industriousness and intelligence of the Chinese people. In addition, Musk assured that Tesla is ready to expand its business in China. According to Qin, “healthy, stable and constructive” Sino-US relations are beneficial to the whole world. Commenting on Beijing-Washington relations, the Chinese minister drew an analogy with driving: one must “apply the brakes in a timely manner and avoid dangerous driving”, as well as be able to “push the gas pedal” to develop cooperation.

Musk also had dinner with the founder of the largest Chinese fuel cell manufacturer Contemporary Amperex Technology (CATL) Zeng Yuqun and, according to Reuters, will visit the Tesla plant in Shanghai. The 16-course menu emphasized the character “ma” (translated as “horse”, but also used at the beginning of Musk’s last name).

Chinese Foreign Ministry Spokesperson Mao Ning welcomed Musk’s visit during the briefing and urged other international business representatives to follow suit and also visit China. At the same time, in March, Reuters reported that Musk wanted to get a meeting with Chinese Premier Li Qiang, but there were no reports of the possibility of such a meeting.

China is Tesla’s second largest market after the US, with the company now accounting for about 11% of the Chinese electric vehicle market. Tesla’s first Chinese factory was opened in Shanghai in 2019 (it took only 168 days from obtaining a building permit to connecting to the grid). In 2022, the production was modernized, and during this year the plant produced more than 700,000 Model Y and Model 3 vehicles. On April 10, 2023, Tesla signed an agreement with the administration of the Lingang Special District of Shanghai to build a new Megafactory. According to Xinhua, the construction of the plant should begin in the third quarter of 2023, and the start of production is scheduled for mid-2024. The commissioning of the new facility will allow the company to increase the assembly of electric vehicles in Shanghai to 1 million units per year, Shanghai The Paper wrote.

This is Musk’s first trip to China in three years (he was there in early 2020). The visit comes right after he ran Florida Gov. Ron DeSantis’s May 25 Republican presidential nomination on Twitter.

Musk’s trip to China is due to his commercial interests, said Alexander Lukin, scientific director of the Institute of China and Modern Asia of the Russian Academy of Sciences. “The American businessman is doing big business in this Asian country, and he is also involved in joint projects to develop artificial intelligence technologies and new energy sources. To this end, he is negotiating with representatives of the Chinese elite and business in order to slightly reduce the severity of the economic war between Washington and Beijing, ”the expert said.

On the other hand, the Chinese authorities are interested in developing joint economic projects with American big business, despite the current political difficulties of the two countries, Lukin continues: “It is no coincidence that the Mask was received at the highest level in China. Especially since he takes a moderate position in the US-China political crisis. In addition, the Chinese authorities perceive him as an opinion leader who could subsequently influence the public mood of the Americans in the way necessary for Beijing.”

At the same time, according to the director of the Foundation for the Study of the United States. Franklin Roosevelt at Moscow State University Yuri Rogulev, Musk does not have enough influence to eliminate contradictions in US-China relations. “Although he has a large fortune, and his economic enterprises periodically perform work for the federal government, he cannot influence the policy of the presidential administration. I admit that in certain circles they will listen to him, but they will not do anything on his orders, ”the expert believes.

Finally, Musk’s trip to China is also an indicator of the dissatisfaction of big American business with Washington’s work in the Chinese direction, Rogulev notes. “American business is a victim of political circumstances, and economic war leads to multi-billion dollar losses. Due to the aggravation of bilateral relations, for example, Apple is forced to close its factories in China. At the same time, it is significant that American companies usually bring their production not back to the United States, but to developing countries,” the expert concludes.