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Fri. May 17th, 2024

Tesla CEO and tech entrepreneur Elon Musk visited Beijing on Sunday to meet with China’s second-highest-ranking official, Premier Li Qiang. During the meeting, Li promised to maintain an open door for foreign companies, emphasizing China’s commitment to creating a favorable business environment. Musk, one of the world’s richest individuals, is in China to explore business opportunities and strengthen Tesla’s presence in the world’s largest electric vehicle (EV) market.

Musk’s visit marks his second trip to China within the past year, underscoring the significance of the Chinese market for Tesla and other global EV manufacturers. In their meeting, Premier Li Qiang reassured Musk of China’s openness to foreign investment and reiterated the government’s dedication to supporting foreign-funded companies. “China’s very large-scale market will always be open to foreign-funded firms,” Li stated, highlighting the country’s efforts to expand market access and provide better service guarantees.

Musk, known for his entrepreneurial ventures and his role at Tesla, expressed his appreciation for China’s business environment. He later posted on his social media platform X, stating that it was an honor to meet with Premier Li. The two have known each other for several years, and Musk acknowledged China’s “hardworking and intelligent” workforce at the Tesla Gigafactory in Shanghai, emphasizing his willingness to deepen cooperation with China to achieve “win-win” outcomes.

The meeting also touched on broader topics, including potential collaboration and other business interests. Earlier in the day, Musk met with Ren Hongbin, the head of the China Council for the Promotion of International Trade, to discuss further cooperation between Tesla and China. Musk’s trip coincided with Beijing’s massive auto show, which opened to the public over the weekend, providing an ideal backdrop for discussions about Tesla’s role in the Chinese EV market.

However, Musk’s visit comes at a challenging time for Tesla in China, where the competition is fierce, and domestic manufacturers are gaining ground. Recent data indicated that China’s local EV giant BYD surpassed Tesla in the fourth quarter of last year, although Tesla reclaimed the title of top EV seller in the first quarter of 2023. Amidst this competitive landscape, Tesla recalled over 1.6 million electric vehicles in China in January due to software issues related to steering.

Despite these challenges, analysts view Musk’s visit as a pivotal moment. A report from Wedbush Securities described the trip as “a watershed moment for Musk as well as Beijing,” especially given recent “softer demand” for Tesla and the intense competition in the Chinese EV market. As the EV industry evolves and Musk seeks new opportunities, the impact of his latest trip to China remains to be seen, with ongoing developments likely to shape Tesla’s future trajectory in this critical market.

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