Published: Sat, March 10, 2018
Economy | By Melissa Porter

Elon Musk is pestering Trump to change auto trade rules with China

Elon Musk is pestering Trump to change auto trade rules with China

Tesla Inc (TSLA.O) Chief Executive Elon Musk took to Twitter on Thursday to call on U.S. President Donald Trump to challenge China's auto trade rules, which limit foreign ownership of Chinese ventures and impose steep tariffs on imported cars.

But when Trump read Musk's tweets during a press event, he said that "at some point", the President was likely to enforce what he called a "reciprocal or mirror tax", where he would match the tariffs China has put on USA imports.

"I am against import duties in general, but the current rules make things very hard", Musk tweeted.

The company had raised the issue with the prior USA administration, Musk added, but nothing had happened.

"Just want a fair outcome, ideally where tariffs/rules are equally moderate", Musk tweeted. "Nothing more. Hope this does not seem unreasonable", Musk tweeted.

Talk of tariffs on aluminium and steel has captivated conversation in the nation's capital ever since Trump tweeted that "trade wars are good, and easy to win" earlier this month.

"It's got to change", the president said, seemingly taking the lead from Musk. On Thursday afternoon, Trump signed two proclamations that implement tariffs on imported steel and aluminum, but exempt Canada and Mexico.

'We want a lot of steel coming into our country, but we want it to be fair and we want our workers to be protected'.

Trump is apparently a big fan of Musk's private space exploration company, SpaceX. Nobody's seen that before, where they're saving the boosters, and they came back without wings, without anything.

"Eat Your Own Dog Food" is an aphorism referring to the Microsoft tradition of using its own software products, but it applies equally well to the first production cargo trip of Tesla's all-electric truck - which carried battery packs from Tesla's Gigafactory in Nevada to its auto assembly plant in Fremont, Calif.

Trump did not immediately respond to Musk's flurry of tweets. However, Tesla and Chinese authorities have yet to announce an agreement.

A 25 percent import tariff on Teslas shipped to China "catapults the sticker price beyond the means of most consumers" and gives manufacturers of cheaper electric vehicles an advantage over Tesla, according to Bloomberg. Meaning, same import duties, ownership constraints & other factors.

China levies a 25% duty on sales of imported vehicles.

That's despite exclusively relying on exporting its cars from the United States to China where they are subject to a 25% import tariff.

Musk has met with Trump on several occasions since his election in November 2016. Musk previously served on Trump's advisory council.

Like this: