Tesla Motors Inc. (TSLA) CEO Elon Musk is taking sides in the issue over trade with China, saying the Asian country is playing unfair.
Musk pointed out that China, the world’s largest car market, slaps a 25 percent import tax on American vehicles with while the U.S. only has a 2.5 percent levy on Chinese autos.
On Twitter today, Musk responded to one of President Donald Trump’s tweets that said the White House is looking to reduce U.S.'s trade deficit with China.The Trump administration wants to cut $100 billion from the U.S.-China trade deficit, which stood at $375.2 billion at the end of 2017. (See also: Where Does the U.S. Import Steel Come From?)
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
Musk’s series of replies said he was “against import duties in general, but the current rules make things very difficult. It's like competing in an Olympic race wearing lead shoes.”
The Tesla CEO also lamented that he “raised this with the prior administration and nothing happened. Just want a fair outcome, ideally where tariffs/rules are equally moderate. Nothing more.”
Tesla has been mulling building a manufacturing facility in China, hoping to open it in less than three years but so far, the company has not announced a deal. In his tweets today, Musk noted that companies based outside of China must have 50-50 joint ventures with a Chinese company in order to build factories there. “But there are five 100% China-owned EV auto companies in the US,” he wrote.
Earlier today, Tesla marked a milestone achievement as its new semi big rigs started carrying their first load of cargo in a delivery of batteries from its Sparks, Nevada facility to its auto plant in Fremont, California. (See also: Tesla Semis Hit The Road with First Cargo.)
Last month, Tesla reported fourth-quarter revenue increased to $3.29 billion, up 44 percent from a year prior. In the past year, the stock has surged about 34 percent, although some investors are getting more bearish on production delays and poor cash flow.