Why Tesla’s ties with China made Elon Musk indispensable to Trump

As Elon Musk seems to be turning into a political heavy-weight, I shared comments with Tala Michel Issa for Arabian Business on the importance of his deep industry and political connections in China for his upcoming role in the Trump 2.0 administration.

Reminding readers that “more than a China-hawk, Trump should be seen as a trade-hawk”, I commented that “the fact that he is being advised by Elon Musk tells me that he may not be that hawkish when it comes to China.“

I insisted on the importance of Tesla’s own experience in the Chinese car market, where Musk cultivated tight relations with local political leadership. “Tesla was probably the Western car manufacturer that benefitted the most from China’s changes in regulations for the automotive industry in 2017, allowing foreign firms to actually own their factories in China”. “This opening policy (…) was supervised by Li Qiang, then-Shanghai Communist Party of China (CPC) Party Secretary and now China’s Prime Minister. Li is seen as pro-business and has in the past favoured economic reforms.”

This should be put in perspective with Trump extending an invitation to Xi Jinping to attend his inauguration on Jan 20. Although declined, this invitation should be seen as an indication that “the incoming administration may view China as a peer competitor rather than an existential threat.” “[This is] something Beijing can surely live with and has actually welcomed. Relying on a private sector trailblazer like Elon Musk who is so deeply involved in China reinforces this message that the two hegemonic powers are not condemned to play a trade and technology zero-sum game.”

And this, in geopolitics, is what we call “good news“…

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Picture credits: Reuters