Elon Musk, the eccentric CEO of Tesla, has commended Chinese electric vehicle (EV) producers once more and forecasted that they will have substantial international success. During Tesla’s most recent earnings call, Musk stated his confidence in these Chinese companies’ competitiveness despite the fact that they are experiencing intense competition.
Musk declared, “The world’s most competitive automakers are the Chinese automakers. So, depending on the kind of tariffs or trade barriers that are put in place, I believe they will have a great deal of success outside of China.” In the absence of such obstacles, he continued, Chinese manufacturers of electric vehicles might be able to “demolish most other companies in the world.”
This claim is made in the midst of a European Commission probe examining subsidies given to Chinese companies that produce electric vehicles. As these companies aggressively enter the European market, they may face challenges if the EU votes to put higher tariffs on Chinese electric vehicles. Notably, BYD has already extended its reach to Europe, the Middle East, and Southeast Asia. In the fourth quarter, it outsold Tesla in the sales of battery-powered cars. Similarly, electric car launches in Europe have been made by Chinese businesses like Xpeng and Nio.
In the year 2023, manufacturers of electric vehicles from China made a noteworthy display of their products at a prominent automobile exhibition in Europe. This caused surprise and curiosity among experts who hinted at the possibility of these companies causing a significant upheaval in the established automotive industry. It is not unheard of for Elon Musk to express admiration for Chinese electric vehicle makers, as he had previously hailed them as exceptionally competent and declared that a Chinese company has the potential to become the second largest player in the global automobile market, trailing only behind Tesla.
Even though Musk was hopeful about Chinese rivals, Tesla’s shares experienced a drop in premarket trading after earnings were released, which didn’t meet expectations. Furthermore, the company issued a warning about a possible slowdown in 2024, causing doubts about how well it will perform amidst increasing competition from Chinese electric vehicle makers.