Elon Musk’s affect over Trump is being carefully watched by Beijing

SHANGHAI — If Donald Trump is elected Tuesday, the previous president has said he may be advised by tech billionaire Elon Musk, who has campaigned for him vigorously in latest weeks and donated greater than $100 million to his marketing campaign.

That, maybe greater than the presidential race itself, is being carefully watched right here in China, the place the world’s richest man has extensive business interests and the looks of a decent relationship with Chinese language officers.

It may be puzzling for observers: Why would Musk assist Trump, who has embraced “decoupling” the world’s two largest economies and vowed even higher tariffs on Chinese language imports that in his first time period ignited a commerce struggle?

Musk stands to lose fairly a bit from decoupling, in addition to any enhance in U.S.-China tensions, mentioned Jia Qingguo, the previous dean of the varsity of worldwide research at Peking College.

“I don’t perceive why he helps Trump that a lot as a result of what Trump has advocated is in opposition to his personal enterprise, a minimum of his enterprise with China,” Jia, who can be a political adviser to the Chinese language authorities, advised NBC Information in an interview.

The Trump marketing campaign didn’t reply to a request for remark. He lately told the Wall Street Journal editorial board that Chinese language President Xi Jinping respects him but in addition is aware of he’s “loopy” and wouldn’t provoke him.

By associating so carefully with Trump, Musk dangers incurring the wrath of Chinese language officers who may see him as aligned with Trump’s insurance policies and a political type seen right here as “unpredictable.” Trump has proposed blanket levies of 60% or higher on all items imported from China, which might hardly be welcome in Beijing as officers attempt to revive a struggling economy.

However Chinese language officers may also see potential for Musk to be a mitigating affect on points akin to tariffs. After saying early this yr that Chinese electric vehicle companies would “pretty much demolish” most of their opponents with out commerce obstacles, Musk did a U-turn and said in May that he opposed President Joe Biden’s newly introduced tariffs on Chinese EVs.

“There’s a really fascinating dynamic there between Musk and China in that he wants them, and he’s attempting to pursue enterprise pursuits there, however they’re additionally more and more, in a long-term sense, probably undermining his enterprise pursuits,” mentioned Kelly Grieco, a senior fellow on the Stimson Middle in Washington, a nonprofit, nonpartisan suppose tank.

Like other American business leaders, Musk has met with senior Chinese language officers as Beijing courts worldwide firms. Throughout a surprise visit to the Chinese language capital in April, he met with Premier Li Qiang, China’s No. 2 official.

In a separate meeting in Beijing final yr with Qin Gang, the Chinese language overseas minister on the time, Musk expressed opposition to “decoupling.”

By publicly criticizing the thought at a time when so many others are loudly calling for it, Musk is enjoying “an vital position” as “a type of bridge between the 2 nations,” Grieco mentioned.

If Chinese language officers obtain Musk virtually like a world chief, the Chinese language public treats him like a rock star.

“He’s a legend,” mentioned Jennifer Lian, 39, a Tesla proprietor in Beijing.

Commenters on the Chinese language social media platform Weibo, the place Musk has 2.2 million followers, have steered he might be the subsequent Henry Kissinger, the late U.S. statesman and longtime U.S.-China middleman who was revered in China and had shut ties to its ruling Communist Celebration.

Chinese language leaders seen when, after Musk’s April go to to Beijing, Trump began speaking about the opportunity of Chinese language EV firms making automobiles in the US, mentioned Ian Bremmer, founder and president of the New York-based consulting agency Eurasia Group.

“Elon’s choice to align himself with Trump has primarily hitched his future in China on whether or not or not he can ship politically,” he wrote in a latest e-newsletter. “That’s vital and it’s completely unclear whether or not he realizes it but.”

‘Biting the hand that feeds you’ 

By Musk’s personal account, most of his enterprise pursuits are outdoors China. SpaceX and its Starlink satellite tv for pc communications system haven’t any enterprise within the nation, whereas his X social media platform, like different main Western social media, is blocked right here.

It’s a distinct story for Tesla, which depends on China because the world’s largest auto market and the corporate’s greatest market outdoors the US.

In October, the corporate mentioned it sold 181,883 vehicles in China within the third quarter, up 30% in contrast with the identical interval a yr earlier and accounting for nearly 40% of its international deliveries.

Tesla’s Shanghai “Gigafactory” is the corporate’s largest manufacturing facility outdoors the U.S. and arguably probably the most important asset in Musk’s EV empire. At full capability, it produces practically 1,000,000 automobiles a yr and an enormous a part of the earnings which have helped make Tesla one of many world’s most dear auto firms. 

The manufacturing facility itself is an enormous advanced of buildings and loading docks that stretches throughout land bordered by canals that create a type of moat round it.

The again aspect of the manufacturing facility is related to the close by freeway by a bridge the place a gentle stream of auto carriers come and go, loaded with new Tesla automobiles to be bought within the Chinese language market and exported to different nations, although to not the US.

Kuan Bin, 34, joined Tesla just a few months in the past to supervise upkeep of the corporate’s hearth security gear. In an interview on the road throughout from the manufacturing facility after his shift, Kuan praised his employer.

“Elon Musk is a superb entrepreneur,” he mentioned. “He’s main the tech enterprise, and Tesla contributes considerably to the native financial system and China’s financial system.”

Simply down the highway from the Gigafactory, building is in full swing at Tesla’s new manufacturing facility that can quickly be making Megapacks — extra-large batteries used to retailer large quantities of electrical energy. Every unit can retailer sufficient vitality to energy 3,600 houses for an hour, in accordance with the corporate. They’re designed with utilities and energy stations in thoughts.

Tesla solely broke floor on the brand new venture in Might, weeks after Musk’s shock go to to Beijing and with U.S.-China tensions hovering. When Shanghai officers made the announcement, they mentioned it had taken the 2 sides solely a month to barter the deal. 

In response to NBC Information’ request for an interview, Tesla declined to remark “presently.”

Tesla has had particular standing in China because it turned the primary overseas automaker allowed to completely personal a Chinese language manufacturing facility, quite than being required to type a three way partnership with a home firm. Simply after breaking floor on that manufacturing facility in 2019, Musk advised then-Premier Li Keqiang that he wished to go to China extra usually, to which Li replied that possibly he might get a Chinese language inexperienced card, in accordance with a report on a Chinese language authorities web site.

As Musk visited Beijing in April, native Chinese language authorities lifted restrictions on Tesla cars after they handed the nation’s information safety necessities for “related automobiles.”

In June, when Tesla’s Mannequin Y was included for the primary time on an inventory of electrical automobiles that might be bought by the Jiangsu provincial authorities, a Jiangsu official advised Chinese language media that whereas particular approval was required for imported items, “Tesla isn’t thought-about an import.”

Musk has additionally mentioned he expects Tesla to get Chinese regulatory approval by the end of the year to start out providing its “Full Self Driving” driver-assistance software program within the nation, information that elevated the worth of Tesla shares and Musk’s internet value.

The corporate “is putting some massive bets on with the ability to develop its autonomous automobiles in China,” Grieco mentioned.

However Musk faces intensifying competitors from Chinese language EV makers akin to BYD, which reported higher quarterly revenue than Tesla for the primary time final week.

Along with electrical automobiles, China can be seeking to develop its potential to compete with the likes of SpaceX and Starlink.

Chinese language officers haven’t been shy about making the connection between what Musk says and the place he makes his cash. Final yr, an editorial within the state-backed nationalist tabloid International Occasions warned Musk about “biting the hand that feeds you” after he appeared to agree with a publish on X speculating that Covid-19 originated in a Chinese language lab.

Grieco mentioned she thought it was “very fascinating” that regardless of Musk being a self-proclaimed free speech advocate, when “China was placing stress on him, or reacting to those feedback, he didn’t reaffirm his perception in free speech. He simply type of didn’t reply.”

Musk’s enterprise ties with China have given rise to different awkward conditions. Tesla was criticized in 2022 when it opened a showroom within the western Chinese language area of Xinjiang, the place rights teams allege widespread abuses in opposition to principally Muslim minority teams that Beijing denies.

Musk has additionally made feedback that unnerved Taiwan, thought-about one of the delicate U.S.-China points, as they have been seen as echoing the views of President Xi. In 2022, he told the Financial Times that battle over the Beijing-claimed island was inevitable, and that maybe it might be headed off by giving China some management over a “particular administrative zone” in Taiwan akin to its association with the Chinese language territory of Hong Kong.

The remark earned reward from Qin, the Chinese language overseas minister on the time, and a rebuke from Hsiao Bi-khim, who was then Taiwan’s de facto ambassador to Washington and is now the island’s vice chairman.

Musk additionally mentioned Beijing had expressed its disapproval of the rollout of Starlink in Ukraine to assist the army within the face of a Russian-imposed web blackout, and requested for his assurance that he wouldn’t promote Starlink in China.

The satellite tv for pc web service that Starlink offers can be essential for Taiwan within the occasion of a Chinese language assault, however considerations about Musk’s ties with Beijing led the island’s predominant telecommunications firm, Chunghwa, to signal a deal final yr with a British-European firm as an alternative.

The subject of Taiwan didn’t come up throughout a conversation that Trump and Musk had on X in August. However Trump has made feedback on the marketing campaign path calling on the island to pay Washington extra for its protection and accusing it of “stealing” chip enterprise from the U.S.

Musk and Trump’s alignment might not be based mostly on coverage a lot as a mutual settlement “in regards to the worth of pursuing enterprise pursuits,” Grieco mentioned.

With Trump and his Democratic rival, Vice President Kamala Harris, taking equally hard-line positions on China, she mentioned, the query for Musk could also be which candidate he might affect extra strongly.

“I believe he has to see it as, Donald Trump is the extra doubtless occasion that he might strike a cope with,” Grieco mentioned.

Janis Mackey Frayer reported from Shanghai, and Jennifer Jett reported from Hong Kong.