When Elon Musk unveiled the first Chinese-made Teslas in Shanghai in 2020, he went off script and started dancing. Peeling off his jacket, he flung it across the stage in a partial striptease.
As Musk explored building the factory in Shanghai, Chinese leaders agreed to a crucial policy change on national emissions regulations after lobbying by Tesla that was not previously reported. That change directly benefited Tesla, bringing in an estimated hundreds of millions of dollars in profits as China production took off,Musk also gained unusual access to senior leaders. He worked closely with a top Shanghai official who is now the Premier, Li Qiang.
“Elon Musk has deep financial exposure to China – including his plant in Shanghai,” says Democrat senator Mark Warner, who chairs the Senate Intelligence Committee. Another former state regulator, Craig Segall, says Tesla lobbied extensively on the emissions regulations, seeking to skew them in a way that enriched Tesla.As California built ties with China, several groups were championing an emissions mandate as a cure for the country’s pollution. Among the policy’s enthusiasts was then-governor Jerry Brown, who saw electric vehicles as a potential area of co-operation. Environmentalists were on board as well.
His group helped plan meetings with Ken Morgan, then a US-based Tesla lobbyist, according to event materials and emails obtained by theIn 2015, Morgan met with officials in three Chinese cities, touting how California’s emissions mandate had helped spur EV production. “Obviously, Tesla was all in,” says Wang, director of the University of California, the Davis China Centre for Energy and Transportation.
“This was even faster than China speed,” says Tu Le, who heads the consultancy Sino Auto Insights, adding that Li’s help was key: “How quickly things happened points to his tacit approval of everything.”Government officials used “very creative yet cautious approaches” to bend policy to Tesla’s wishes, Tao told Yicai Global, a Chinese media outlet, adding that she was “deeply impressed”.
But Huang says the deal made sense for the banks. He had long been impressed by Tesla, at one point importing a car and disassembling it to study how it worked. Like Li, he had visited the Tesla factory in Fremont, California, which had struck him as chaotic but promising.