Elon Musk’s special position in China

Billionaire Elon Musk and more than 12 CEOs and business leaders accompanied US President Donald Trump to Beijing on May 14-15 to attend the summit with Chinese President Xi Jinping. The delegation also includes Apple CEO Tim Cook and Jensen Huang (Nvidia). Most of them want to come here to resolve problems with Beijing.

Speaking to the press as he left the Great Hall of the People, Musk said he wanted to achieve “many good things” in China. Despite being under great pressure on price and technology from domestic competitors, Tesla and Musk personally still maintain influence here.

Kyle Chan, a China technology researcher at the Brookings Institution, believes that part of the reason is that Musk’s concerns align with Beijing’s priorities. “If you look at China’s technology priorities, a lot of things almost coincide with what Musk is pursuing, from electric cars, self-driving cars to AI, humanoid robots, satellites,” Chan said.

He said Tesla’s self-driving technology is still considered the industry standard in China.

In an interview with Reuters Last month, Chery electric car company Chairman Yin Tongyue said that they were inspired by Tesla and Toyota. They want to combine the American electric car company’s innovation capabilities with the Japanese automaker’s pursuit of quality. Chery is expanding its presence in Europe.

In 2018, Tesla became the first foreign car company allowed to establish a car factory in China without a joint venture with a domestic partner. According to the China Passenger Vehicle Association, Tesla sold about 626,000 units in the country last year, becoming the 5th largest car company here by electric and hybrid vehicle sales (electric and gasoline cars). According to data from the US electric car company, China contributes about 20% of the company’s revenue by 2025.

Felipe Munoz – a veteran auto industry analyst – said Tesla’s focus on battery performance and software “is one of the biggest inspirations for many Chinese car manufacturers”. Munoz revealed that during the pandemic, when traditional car manufacturers struggled with blockades and chip shortages, many Chinese companies researched Tesla cars and developed their own versions.

However, Beijing criticized other businesses in Musk’s empire. SpaceX’s almost absolute monopoly in the field of low-orbit satellites, along with Starlink’s role in the Russia-Ukraine conflict, have made Beijing worried. This motivated them to develop domestic alternatives.

Even though social network X is banned in China, Musk still has 2.3 million followers on Weibo. During several previous visits, he was hailed by local media as a “pioneer” and “global idol”. Even Musk’s mother became a celebrity in China.

The world’s richest man is also very familiar with the ups and downs of doing business in China. This week’s visit takes place in the context that the US electric car company wants to buy 2.9 billion USD of solar battery production equipment from suppliers in this country. However, this plan may become complicated as Beijing considers restricting exports of the most advanced technology to Washington.

Tesla also seeks approval from Chinese authorities to expand the application of Full Self-Driving (FSD) driver assistance software.

Musk has so far been very cautious when doing business in China. The world’s largest auto market and its huge supply chain play an essential role in his business empire.

In 2021, billionaire Elon Musk’s electric car company was forced to apologize to Chinese consumers for not promptly handling a customer complaint. This person was so dissatisfied that she climbed onto the roof of a Tesla at the Shanghai auto show to protest the way the company handled her complaint about brake errors. This image spread widely on Chinese social networks, drawing criticism from the media.

Also this year, Tesla cars were banned from entering military zones due to security concerns related to on-board cameras. The ban was only lifted after Musk’s visit to China in 2024 and the country’s auto association confirmed Tesla’s compliance with data regulations.

In the long term, the biggest threat to Musk’s popularity in China may come from the development of the domestic auto industry. According to Chang Yan – founder of the famous electric car blog Supercharged on Weibo, when Chinese companies catch up or even surpass Elon Musk’s technology empire, this billionaire’s position here may gradually decline.

“However, he is still an icon to the Chinese technology industry because of what he has achieved,” Yan said.

Elon Musk is currently the richest person in the world with assets of 827 billion USD, according to Forbes. In addition to being CEO of electric car company Tesla, he also runs many other companies, from SpaceX, The Boring Company to Neuralink. Earlier this year, Musk merged SpaceX and xAI into the world’s largest private company. The company then secretly filed for an IPO in the US, with a potential valuation of more than $1,750 billion.