Elon Musk, CEO of Tesla, visited China for the first time in over three years and held consecutive meetings with high-ranking officials, followed by a meeting with Zheng Yuqin, Chairman of Ningde Times (CATL), China’s largest battery supplier.
Bloomberg reported on the 31st (local time) that Musk met with Zheng Yuqin, Chairman of CATL, in Beijing, China. Although the main content of their discussion was not disclosed, Bloomberg speculated that Musk likely discussed a joint venture with CATL to build a battery manufacturing plant in the United States.
Tesla is reportedly pursuing a joint venture deal similar to Ford Motor’s plan to partner with CATL to build a battery factory in Michigan.
CATL produces lithium iron phosphate (LFP) batteries, which have lower production costs compared to the nickel-cobalt-manganese (NCM) batteries mainly used in Western countries, securing a strong competitive edge in the battery industry.
Tesla currently uses CATL batteries in some models, including the Model Y, but the U.S. government does not provide subsidies under the Inflation Reduction Act (IRA) for these models because their batteries are produced in China.
There is expected to be criticism in U.S. political circles regarding the Tesla-CATL joint venture. Previously, regarding Ford and CATL’s joint factory establishment, Senator Joe Manchin (Democrat), chairman of the Senate Energy and Natural Resources Committee who led the IRA legislation, and Senator Marco Rubio (Republican), vice chairman of the Senate Intelligence Committee, opposed the move, arguing that “a Chinese company is receiving U.S. subsidy benefits.”
Meanwhile, after meeting with Chairman Zheng Yuqin, Musk reportedly left Beijing on the evening of the 31st and headed to Shanghai. Bloomberg, citing anonymous sources, reported that Musk plans to tour Tesla’s local factory in Shanghai and then meet with Chinese Premier Li Chang to discuss the introduction of autonomous driving technology in China.
This visit marks Musk’s first trip to China in over three years since his visit to the Shanghai factory in early January 2020. On the 30th, Musk met with Qin Gang, Chinese State Councilor and Foreign Minister, followed by consecutive meetings with three current ministers: Wang Wentao, Minister of Commerce, and Jin Zhuanglong, Minister of Industry and Information Technology.
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