Tesla Inc. (TSLA) CEO Elon Musk initiates a crucial China visit by meeting with the country’s foreign minister in Beijing. This visit marks his return to Tesla’s primary manufacturing center after a three-year absence.
Following China’s decision to reopen its borders and revise its zero-COVID policy in December, several prominent CEOs from top U.S. companies have been visiting the country. In March, Tim Cook of Apple (AAPL) paid a visit, and this week, Jamie Dimon from JP Morgan (JPM) and Laxman Narasimhan from Starbucks (SBUX) are also in China. This trend continues with Musk’s current trip to the country.
Musk had a meeting with Chinese foreign minister Qin Gang shortly after his arrival in Beijing. Qin assured Musk that China is dedicated to enhancing the business environment for investors, including Tesla. He used a driving metaphor to describe the China-U.S. relationship, emphasizing the need to apply brakes when necessary, avoid risky behavior, and skillfully accelerate to promote mutually beneficial cooperation.
Musk expressed his willingness to expand Tesla’s operations in China and voiced his opposition to the idea of separating the U.S. and China economies. He described the two countries as “conjoined twins,” highlighting their interconnectedness and interdependence. After the United States, China holds the position of being Tesla’s second-largest market.
Following his arrival in China, Elon Musk, who is also the owner of Twitter, maintained a low profile on the platform. Twitter is banned in China but can be accessed by some users through a virtual private network (VPN). Musk also refrained from posting on his official Weibo account, which is a popular social media platform in China.
During his trip, Elon Musk is anticipated to meet with various high-ranking Chinese officials and visit Tesla’s manufacturing plant in Shanghai, as per Reuters’ report on Monday. However, the specific individuals he would meet and the topics to be discussed remain unclear. According to a source familiar with the matter, a meeting with Zeng Yuqun, Chairman of CATL (300750.SZ), a major Chinese battery supplier for Tesla, is also scheduled to take place in Beijing.
Tesla is facing growing competition from Chinese-made electric vehicles, and there are concerns regarding the expansion plans for its Shanghai plant, which serves as its primary production hub.
Some analysts view China’s electric vehicle market, the largest in the world, as a highly profitable opportunity for Tesla and therefore expect the company to prioritize the expansion of its presence in China. Tesla’s Shanghai plant is the central hub for the company’s global production.
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