Musk lobbies Trump to prod China over auto trade practises

Ivan Schwartz
March 10, 2018

Tesla CEO Elon Musk tweeted at U.S. president Donald Trump about the unfairness of the rules governing the vehicle trade between China and the US. First, he said that the U.S. places only a 2.5 per cent tariff on cars imported to the USA from China, while China places a 25 per cent tariff on United States imports.

Import duties and the difficulties Tesla has had avoiding them by producing in China is keeping the company from fully taking advantage of the world's biggest market for cleaner cars.

As we noted in a previous report, Tesla is now facing a possible roadblock with its plan to open a factory in China.

Tesla has said it essentially doubled sales in China to about $1 billion a year ago, which makes it a very successful luxury vehicle in the world's largest auto market.

To further entice the president to take action, Musk finished his tweetstorm by explaining how "nothing happened" when he brought up these issues with the past administration. All Tesla wanted was a fair outcome, "ideally where tariffs/rules are equally moderate". "Nothing more. Hope this does not seem unreasonable", he said.

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Tesla CEO Elon Musk responded to a tweet from President Donald Trump with a rant about China on Thursday. The President said he would introduce tariffs of 25 per cent on imported steel and 10 per cent on aluminium, figures that sent minor shockwaves through the stock market. Musk owns about 20% of the auto company and will not vote on his compensation. "It's got to change", Trump said, saying he plans to impose a "reciprocal tax" on other countries. "They've known it for years, they never did anything about it".

He also noted that he is generally for free trade, but highlighted the fact the current regulations make it hard. The tweets came as Trump prepared to make an announcement on tariffs for imported steel and aluminum.

China, which is making a major push toward electric cars, requires foreign automakers to build factories in 50-50 joint ventures with domestic Chinese automakers and not allowed them to establish wholly owned factories.

Earlier Thursday, Trump praised Musk and SpaceX as he hailed the private space industry. "To me, that was more incredible than watching the rocket go up, because I've never seen that before". The Tesla chief executive officer served on two White House advisory councils before stepping down in June after the president announced he would pull the USA out of the Paris climate accord. "They landed so beautifully".

Other reports by GizPress

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