Elon Musk denied news of selling Tesla branch in China

On July 30, Wall Street Journal quoted a close source saying that leaders of the electric car company Tesla were asked to prepare a plan to separate its business in China, ahead of the possibility of merging with aerospace company SpaceX. Tesla’s advisors have discussed many options, including separating into an independent company, selling or closing. However, this source also affirmed that it is unclear how quickly Tesla will do this and the plan can still change.

Tesla CEO Elon Musk later denied this on social network X: “This has never been mentioned in any discussion.” He called the above information “silly fake news”.

The merger of Tesla with SpaceX will face many geopolitical and legal barriers, especially in China. SpaceX participates in many US satellite and national security programs. Meanwhile, Tesla operates in China without joint ventures with local companies.

Over the years, investors and analysts have repeatedly speculated about Musk’s ability to merge these two companies. The above speculation increased when SpaceX conducted an initial public offering (IPO) with a record scale of 75 billion USD in mid-June.

Last week, Musk also did not rule out the possibility of a merger. He only said that the two businesses have more and more overlapping areas of operation.

According to Wall Street Journal‘s sources, in recent years, Musk has asked Tesla leaders to arrange the company in a way that “has boundaries” between operations in the US and China. This is to ensure that if geopolitical tensions between the two countries escalate, at least Tesla’s US business can still survive.

Unlike many foreign car companies, Tesla operates in China without having to enter into joint ventures with local partners. The Shanghai Gigafactory remains Tesla’s largest and most efficient production facility globally, as well as an export hub to Europe, Canada and the Asia-Pacific region.

This factory currently contributes more than half of Tesla’s total global vehicle deliveries. Annual capacity exceeds 950,000 vehicles.