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He says high tariffs on cars imported to China, as well as manufacturing rules there, have made things ‘very difficult’ for Tesla
Hours before a scheduled announcement about tariffs on imported steel and aluminum, Tesla CEO Elon Musk posted a series of tweets directed at President Trump asking for “equal & fair rules for cars” when it comes to the US and China.
Musk spoke out against two things that he says have made things “very difficult” for Tesla. First, he explained to the president how the US places a 2.5 percent tariff on cars imported to the US from China, while China places a 25 percent tariff on US imports. Then he brought up how, in China, the government forces foreign automakers that want to manufacture cars in the country to partner with a Chinese car company.
Tesla has exported cars to China for years now, and they sell well in the country, accounting for around 9 percent of the EV market there. To get around the 25 percent import tariff, though, the company has explored setting up a factory. While other major carmakers like GM have acquiesced to China’s manufacturing rules, Tesla has resisted partnering with local carmakers, and has been pushing the government there for an exemption. The government reportedly won’t budge, and so the two sides are at an impasse.
On Twitter, Musk complained this was unfair since there are “five 100 [percent] China-owned EV auto companies in the US,” (presumably referring to startups like NIO, Faraday Future, SF Motors, and Byton). He also said that Tesla tried to work with the Obama administration on this imbalance, but that “nothing happened.”
“I am against import duties in general, but the current rules make things very difficult. It’s like competing in an Olympic race wearing lead shoes,” Musk wrote. “Just want a fair outcome, ideally where tariffs / rules are equally moderate. Nothing more. Hope this does not seem unreasonable.”
Trump’s tariff announcement is thought to be limited to steel and aluminum, though there are scant details on specifics of the plan. But its likely he could expand the scope of the tariffs considering earlier this week he tweeted that “trade wars are good, and easy to win.”
What is known about Trump’s plan is already deeply unpopular, especially among his fellow Republicans. This week, Cabinet member Gary Cohn resigned over Trump’s push for new tariffs, and 107 Republican lawmakers sent Trump a letter urging him to reconsider the idea (though they asked him to focus on China if he were to push ahead). And both Ford and General Motors joined a chorus of US companies that have spoken out against the idea.
Musk served on two of Trump’s advisory councils in the earliest months of his presidency before resigning over Trump’s decision to pull the US out of the Paris Climate Agreement last summer. Considering that he has had the president’s ear before, it’s telling that he thinks the way to tilt the scales now with China is to ask the president for these specific changes publicly. And it’s revealing that he felt the need to explain the tariffs he wants changed as well as the manufacturing rule in China, while also referencing the previous administration — a popular method for anyone trying to sway Trump’s opinion.
Tesla and SpaceX have benefitted from government support in the past, which is why Musk drew criticism for remaining on Trump’s advisory councils as long as he did. Trump has not yet responded to Musk, but whether or not he considers Musk’s appeal for new tariffs on Chinese auto imports, or a change to the rules about foreign automakers in the US, the president clearly admires the billionaire CEO; just this morning, he praised Musk for SpaceX’s recent success with the first-ever launch of the Falcon Heavy.
https://www.theverge.com/2018/3/8/17097158/elon-musk-tesla-trump-china-tariffs-trade-twitter
Hours before a scheduled announcement about tariffs on imported steel and aluminum, Tesla CEO Elon Musk posted a series of tweets directed at President Trump asking for “equal & fair rules for cars” when it comes to the US and China.
Musk spoke out against two things that he says have made things “very difficult” for Tesla. First, he explained to the president how the US places a 2.5 percent tariff on cars imported to the US from China, while China places a 25 percent tariff on US imports. Then he brought up how, in China, the government forces foreign automakers that want to manufacture cars in the country to partner with a Chinese car company.
Tesla has exported cars to China for years now, and they sell well in the country, accounting for around 9 percent of the EV market there. To get around the 25 percent import tariff, though, the company has explored setting up a factory. While other major carmakers like GM have acquiesced to China’s manufacturing rules, Tesla has resisted partnering with local carmakers, and has been pushing the government there for an exemption. The government reportedly won’t budge, and so the two sides are at an impasse.
On Twitter, Musk complained this was unfair since there are “five 100 [percent] China-owned EV auto companies in the US,” (presumably referring to startups like NIO, Faraday Future, SF Motors, and Byton). He also said that Tesla tried to work with the Obama administration on this imbalance, but that “nothing happened.”
“I am against import duties in general, but the current rules make things very difficult. It’s like competing in an Olympic race wearing lead shoes,” Musk wrote. “Just want a fair outcome, ideally where tariffs / rules are equally moderate. Nothing more. Hope this does not seem unreasonable.”
Trump’s tariff announcement is thought to be limited to steel and aluminum, though there are scant details on specifics of the plan. But its likely he could expand the scope of the tariffs considering earlier this week he tweeted that “trade wars are good, and easy to win.”
What is known about Trump’s plan is already deeply unpopular, especially among his fellow Republicans. This week, Cabinet member Gary Cohn resigned over Trump’s push for new tariffs, and 107 Republican lawmakers sent Trump a letter urging him to reconsider the idea (though they asked him to focus on China if he were to push ahead). And both Ford and General Motors joined a chorus of US companies that have spoken out against the idea.
Musk served on two of Trump’s advisory councils in the earliest months of his presidency before resigning over Trump’s decision to pull the US out of the Paris Climate Agreement last summer. Considering that he has had the president’s ear before, it’s telling that he thinks the way to tilt the scales now with China is to ask the president for these specific changes publicly. And it’s revealing that he felt the need to explain the tariffs he wants changed as well as the manufacturing rule in China, while also referencing the previous administration — a popular method for anyone trying to sway Trump’s opinion.
Tesla and SpaceX have benefitted from government support in the past, which is why Musk drew criticism for remaining on Trump’s advisory councils as long as he did. Trump has not yet responded to Musk, but whether or not he considers Musk’s appeal for new tariffs on Chinese auto imports, or a change to the rules about foreign automakers in the US, the president clearly admires the billionaire CEO; just this morning, he praised Musk for SpaceX’s recent success with the first-ever launch of the Falcon Heavy.
https://www.theverge.com/2018/3/8/17097158/elon-musk-tesla-trump-china-tariffs-trade-twitter
