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How Tesla is Winning From the U.S.-China Trade War
In the midst of a heated trade war with the U.S., China rolled out the red carpet for Tesla. That treatment will continue as long as the American electric vehicle maker’s success keeps boosting the fortunes of China’s homegrown EV industry.
On Nov. 1 last year, Tesla invited executives from dozens of China-based automotive parts suppliers to the carmaker’s new Shanghai factory, where its first made-in-China Model 3 sedans were about to roll out. At the event, Roshan Thomas, Tesla’s senior executive in charge of managing suppliers, gave a speech explaining that Tesla needed to continually push down the price of its cars in order to hit big sales targets. He used a chart showing how price cuts had boosted sales in the U.S.
“Tesla needs your help,” Thomas said to the suppliers, according to an attendee.
The message was clear: For its cars assembled in Shanghai, Tesla wanted to have more components produced in China rather than imported.