Elon Musk holds an oversized affect within the new Trump management.
As head of his Division of Govt Potency, or DOGE, the arena’s wealthiest guy has loved just about unfettered political energy in slashing and refashioning the government as he sees have compatibility. And it has temporarily transform transparent that he has the president’s ear on problems past that transient.
However on one matter, Musk stands relatively excluding others within the coterie of aides and advisers round Trump: China. Against this to the numerous hawks within the new Trump cupboard who name for a hard-line method on China, Musk is a putting outlier.
As knowledgeable on China-U.S. members of the family who has monitored Musk’s perspectives on China, I don’t to find his lengthy historical past of espousing pro-Chinese language sentiment sudden, for the reason that he has sought all through to get a industry dangle within the nation.
However the ones entanglements are price scrutiny, given Musk’s position within the Trump management at a time when certainly one of The usa’s largest overseas coverage demanding situations is methods to arrange its courting with Beijing.
Musk’s adventure to the East
For years, Musk has had vital industry pursuits in China, with Tesla’s Shanghai manufacturing facility, Tesla Giga Shanghai, taking part in a a very powerful position within the corporate’s world operations.
Since its opening in 2019, the Shanghai plant has surpassed Tesla’s Fremont, California, facility in each dimension and productiveness, now accounting for greater than part of the corporate’s world deliveries and a majority of its earnings. Additionally, just about 40% of Tesla’s battery provide chain depends upon Chinese language firms, and those partnerships proceed to amplify.
Elon Musk walks with Shanghai Mayor Ying Yong throughout the groundbreaking rite for a Tesla manufacturing facility in Shanghai on Jan. 7, 2019.
STR/AFP by means of Getty Photographs
Significantly, Tesla was once the primary overseas automaker accredited to ascertain operations in China and not using a native spouse, following a metamorphosis in possession laws. The Shanghai manufacturing facility was once built with the enhance of US$1.4 billion in loans from Chinese language state-owned banks, granted at favorable rates of interest.
Between 2019 and 2023, the Shanghai govt additionally supplied Tesla with a discounted company tax fee of 15% – 10 share issues not up to the usual fee.
The fee benefits of producing in Shanghai, which come with decrease manufacturing and exertions bills, have additional cemented Tesla’s reliance at the Chinese language marketplace.
For the reason that Musk’s wealth is in large part tied to Tesla inventory, his monetary status is an increasing number of dependent at the corporate’s fortunes in China, making any doable disengagement from the rustic each economically and strategically difficult.
Tesla’s persisted funding in China underscores this dependency. On Feb. 11, 2025, the corporate opened its moment manufacturing facility in Shanghai — a $200 million plant this is set to supply 10,000 megapack batteries yearly. It’s the corporate’s first megapack battery manufacturing facility out of doors the U.S..
This funding deepens Tesla’s presence in China amid a brand new wave of U.S.-China business tensions. On Feb. 1, the Trump management imposed a ten% tariff on Chinese language imports, prompting Beijing’s retaliation with price lists on American coal, liquefied herbal fuel, agricultural apparatus and crude oil.
A Chinese language fan
It stays unclear to what extent Musk’s monetary pursuits in China will translate to actual affect over the Trump management’s coverage towards Beijing. However Musk’s lengthy historical past of pro-China remarks suggests the path he needs the management to transport.
All through his seek advice from to Beijing in April 2024, Musk praised the rustic, noting additionally: “I also have a lot of fans in China – well, the feeling is mutual.”
His admiration seems to hinge partially on how he perspectives industry and exertions practices in China. In that vein, Musk has criticized American employees as lazy and has confronted U.S. exertions legislation disputes, whilst concurrently praising Chinese language employees for “burning the 3 a.m. oil” beneath an intensely repressive exertions gadget.
In a large number of posts at the social media platform X, previously Twitter, which he owns, Musk has additionally praised China’s infrastructure and high-speed rail gadget, lauded its area program, applauded its management in world inexperienced power tasks and recommended his fans to seek advice from the rustic.
Musk has additionally adverse U.S. efforts to decouple from China, describing the nations’ economies as “conjoined twins,” regardless of a large a part of the overseas coverage status quo within the West viewing lowered dependency on China as vital for safety pursuits amid emerging geopolitical tensions.
At the factor of Taiwan, essentially the most bad flashpoint in U.S.-China members of the family, Musk has when put next Taiwan to Hawaii, arguing that it’s an integral a part of China and noting that the U.S. Pacific Fleet has averted mainland China from attaining reunification by means of pressure.
Musk additional advised that the Taiwan dispute may well be resolved by means of permitting China to ascertain Taiwan as a different administrative zone, very similar to Hong Kong.
His remarks have been shared and welcomed by means of China’s then-ambassador to the U.S., who, in a put up on X, emphasised China’s so-called non violent unification technique and advocated for the “one country, two systems” style.
Trump’s back-channel envoy?
The large query going ahead is how Musk’s monetary stakes in, and mentioned admiration for, China will translate into makes an attempt to persuade the U.S. management’s China coverage, in particular given Musk’s unconventional advisory position and the robust faction of anti-China hawks in Trumpworld.
Given Musk’s way to China, it’s not easy to look him now not making an attempt to make use of his affect with the president to push for relatively hotter members of the family with Beijing.
If such recommend have been heeded, it’s simple to check Musk leveraging his deep ties to China, in particular his shut non-public courting with China’s present second-ranking professional, Premier Li Qiang, who was once the Shanghai celebration leader when Tesla’s manufacturing facility was once constructed. Within the state of affairs, Donald Trump may faucet Musk as a again channel for international relations to ease U.S.-China tensions and facilitate bilateral cooperation when wanted.
Up to now, it was once, in all probability, telling that it was once Musk who met with China President Xi Jinping’s envoy to Trump’s inauguration, Vice President Han Zheng, at the eve of the development.
But it surely’s a long way from sure that Trump needs that diplomatic position for Musk, or that different voices gained’t win out in regards to Beijing. In his first time period, Trump introduced an remarkable business conflict and tech blockade towards China, basically reshaping U.S.-China members of the family and pushing the U.S. towards one thing of a bipartisan consensus to counter Beijing that has existed for a number of years.
Trump’s tariff strikes and second-term selections for best business and trade roles, like Peter Navarro and Jamieson Greer — who performed key roles within the business conflict towards China throughout the president’s first time period — recommend that Trump’s dedication to additional decoupling from China stays robust.
Moreover, Musk’s industry pursuits and private wealth tied to China may go away him liable to Chinese language affect. By way of leaning on Musk’s shut ties with Trump, China may use his dependence at the Chinese language marketplace as a bargaining chip to power Trump into making concessions on problems with primary strategic significance to Beijing.
China has a historical past of coercing overseas firms reliant on its marketplace into making compromises on issues regarding its nationwide pursuits. For example, Apple got rid of digital personal community apps from its app retailer in China on the govt’s request. In a similar way, Tesla may face similar power sooner or later if Beijing needs to make use of Musk as a cudgel to persuade coverage within the Trump management. Significantly, as the top of DOGE, with get entry to to delicate knowledge from a couple of companies, Musk may to find himself stuck between U.S. safety scrutiny and China’s strategic concentrated on.
As long as Musk keeps the affect with Trump that he holds now, it’s imaginable that his pro-China sentiments will translate into makes an attempt to persuade govt coverage. But although that is to be the case, whether or not the ones efforts be triumphant is determined by the president and his different advisers, lots of whom are searching for an competitive entrance towards Beijing and are more likely to view Musk as an obstacle reasonably than best friend in that combat to return.
