Tesla boss and real-life Bond villain Elon Musk tweeted at President Trump about the difficulties his company faces with the Chinese market and how the current regime is unfair towards U.S. carmakers trying to set their foot in the world’s biggest market.
President Trump then read Musk’s tweets during a press conference, using them to back up his decision on changing import duties on steel and aluminum, promising to continue revising tariffs on imported goods from certain countries.
Tesla has been trying to establish a factory in China for quite some time now, but negotiations with the local government have been tough, in part because the American carmaker wants to keep full control of any local partnership and protect its intellectual property.
“No US auto company is allowed to own even 50% of their own factory in China, but there are five 100% China-owned EV auto companies in the US,” Musk wrote in one of his tweets aimed at Trump.
China’s car rules dictate that foreign automakers should partner with a local manufacturer in order to establish a production facility there and avoid the steep 25 percent import duty.
“If China’s going to charge us 25 percent or if India’s going to charge us 75 percent, and we charge them nothing, if they’re at 50, or they’re at 75, or they’re at 25, we’re gonna be at those same numbers, it’s called reciprocal, it’s a mirror tax, so they charge us 50 we charge them 50, right now they’ll charge us 50 we’ll charge them nothing, it doesn’t work. So that’s called a reciprocal tax, or mirror tax, and we’re going to be doing a lot of that,” Trump said during the press conference.
Do you think the US & China should have equal & fair rules for cars? Meaning, same import duties, ownership constraints & other factors.
— Elon Musk (@elonmusk) March 8, 2018
Also, no US auto company is allowed to own even 50% of their own factory in China, but there are five 100% China-owned EV auto companies in the US
— Elon Musk (@elonmusk) March 8, 2018
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.
— Elon Musk (@elonmusk) March 8, 2018
We raised this with the prior administration and nothing happened. Just want a fair outcome, ideally where tariffs/rules are equally moderate. Nothing more. Hope this does not seem unreasonable.
— Elon Musk (@elonmusk) March 8, 2018
To be clear, I think a fair outcome for all is quite likely. China has already shown a willingness to open their markets and I believe they will do the right thing.
— Elon Musk (@elonmusk) March 9, 2018
H/T to Sebastien