Tesla CEO Elon Musk is reportedly planning his first journey to China in three years, as per three insiders who wish to remain anonymous. During his anticipated visit, Musk is expected to engage with high-ranking Chinese officials and tour Tesla's Shanghai facility.
The particulars of Musk's visit, including the officials he is set to meet and the subjects of their discussions, remain undisclosed at present. Tesla and China's State Council Information Office have yet to comment on the impending visit.
Back in March, Reuters reported that Musk intended to travel to China and was hoping to arrange a meeting with Chinese Premier Li Qiang by April. However, the exact schedule was dependent on the Premier's availability.
Tesla regards China as its second-most significant market, following the United States, with the Shanghai plant serving as the electric carmaker's most substantial production center. It's noteworthy that Twitter, another company owned by Musk, is prohibited in China, though some individuals access it via virtual private networks (VPNs).
Musk's last China visit in early 2020, which involved a memorable dance performance at a Tesla Shanghai factory event, went viral. This impending visit happens at a crucial time for Tesla, as they face escalating competition from Chinese automakers, who are exporting China-manufactured electric vehicles amid dwindling demand in the world's largest auto market.
Despite not providing recent updates on its objective to augment production by 450,000 vehicles annually at the Shanghai facility, Tesla did announce plans in April to construct a factory for manufacturing Megapack energy storage products in Shanghai. Furthermore, Tesla has submitted plans to local authorities to increase powertrain production at the Shanghai plant to 1.75 million units annually.
China's state planner, however, is grappling with an overcapacity problem in its auto industry, which hosts more than 100 competitors. It's been circumspect in authorizing new production capacity.
In a recent CNBC interview, Musk acknowledged constraints on Tesla's ability to expand in China, emphasizing, "It's not a demand issue." He also expressed his concern about the escalating tensions between the U.S. and China, labeling them a "concern for everyone."
Simultaneously, Tesla is developing a factory in Mexico expected to produce a lower-cost electric vehicle based on its forthcoming platform.
