May 14 - Elon Musk’s reception in China mixes admiration and unease. Widely praised at times for his technological vision, he has also drawn criticism from regulators and the public for customer service failures. Meanwhile, the growing role of SpaceX and its Starlink satellite network has unsettled the People’s Liberation Army. As Chinese automakers narrow the lead Tesla once enjoyed, Musk’s prestige and leverage in China face headwinds.
Musk is part of a delegation of more than a dozen chief executives and senior executives traveling with U.S. President Donald Trump to Beijing for talks with President Xi Jinping. The business contingent includes leaders such as Apple’s Tim Cook and Nvidia’s Jensen Huang, and many of its members are specifically aiming to address outstanding issues with Chinese authorities. Musk, who has experienced the fluctuations of operating in China firsthand, told reporters as he left the Great Hall of the People that he hopes to accomplish "many good things" in China.
Despite intensifying competition from domestic electric vehicle manufacturers on both technology and price, Tesla and Musk retain significant influence in China. That influence stems in part from alignment between some of Musk’s technological priorities and Beijing’s stated tech goals. Kyle Chan, a fellow in Chinese technology at the Brookings Institution, noted that many of the areas Beijing highlights - electric vehicles, autonomous driving, artificial intelligence and humanoid robotics - correspond closely with Musk’s initiatives, and extend to topics such as brain-computer interfaces and satellite systems.
Chan also described Tesla’s driver assistance and self-driving work as the industry benchmark in China. Chinese automakers have been explicit about drawing lessons from Tesla. Yin Tongyue, chairman of Chery, said in a recent interview that his company takes inspiration from Tesla and Toyota, seeking to fuse Tesla’s innovation focus with Toyota’s emphasis on quality. Chery, which is expanding into European markets, reflects the approach of some domestic firms that adopt Tesla-derived ideas with their own execution and quality controls.
Tesla’s long-standing presence in China has unique elements: in 2018 the company became the first foreign automaker allowed to establish an automotive operation in China without a local joint venture partner. Last year Tesla sold roughly 626,000 vehicles in China, positioning it as the country’s fifth-largest automaker by sales of electric vehicles and plug-in hybrids, according to data from the China Passenger Car Association. Company disclosures indicate that China accounted for about one-fifth of Tesla’s revenue in the prior year.
Industry analysts say Tesla’s emphasis on battery-centric vehicle design and software has been a major influence on Chinese manufacturers. Felipe Munoz, an automotive analyst, observed that during the pandemic, when traditional global automakers faced lockdowns and semiconductor scarcity, many Chinese firms used the pause to study Tesla’s products and develop their own iterations.
Yet other aspects of Musk’s business have provoked resistance from Beijing. The significant market position held by SpaceX in low-Earth orbit communications - and the operational role of its Starlink satellites in the Russia-Ukraine conflict - has generated concern among Chinese analysts and military researchers. Those concerns have helped spur efforts in China to build domestic alternatives to foreign satellite communications systems. A September 2022 paper co-authored by researchers at an engineering school affiliated with the People’s Liberation Army argued that Starlink’s effective performance in that conflict would likely lead Western militaries to rely on it heavily in future confrontations, including potential engagements in Asia.
Public visibility for Musk in China is mixed. His social media platform X is blocked inside the country, yet he maintains a substantial following on local platforms, with 2.3 million followers on Weibo. During previous visits he has been lauded on Chinese social media with labels ranging from "pioneer" to "Brother Ma" and "global idol." Even family members have attracted attention: his mother has become somewhat of a celebrity among segments of the Chinese public.
Musk’s commercial ambitions in China extend beyond cars. Earlier reporting indicated he was exploring purchases of about $2.9 billion in equipment to produce solar panels from Chinese suppliers. That procurement effort could face complications if China proceeds to restrict exports of advanced technologies to the United States. Separately, Tesla is seeking regulatory approval in China to broaden the use of its Full Self-Driving assistance system.
Operating in China has required careful maneuvering. Tesla issued an apology in 2021 after it was criticized for not responding promptly to a customer complaint; that incident, in which a customer climbed onto a Tesla at the Shanghai auto show to protest poor handling of brake concerns, circulated widely on social media and prompted negative commentary in state media. Also in 2021, Teslas were prohibited from entering military compounds over security concerns tied to onboard cameras. That restriction was removed following a 2024 visit by Musk and an endorsement of Tesla’s data compliance from the auto industry association.
Looking beyond the near term, the clearest long-term vulnerability to Musk’s standing in China is the rapid improvement of domestic auto makers. Chang Yan, founder of a popular Weibo blog focused on electric vehicles, said that as Chinese companies catch up technologically and in scale, Musk’s stature could dim. Nonetheless, Chang added, Musk is likely to remain an icon within China’s technology community given his achievements.
Contextual note for market and logistics observers - For supply chain and manufacturing networks that support electric vehicle and solar panel production, developments in China around technology access, export controls and domestic capability gains will be critical to monitor. The interplay between Tesla’s ongoing product approvals, procurement plans, and shifting regulatory boundaries in China could influence supplier sourcing, equipment flows and production footprints for companies in the EV and renewable equipment sectors.