Drive an hour outside China’s commercial capital Shanghai, and you’ll reach Elon Musk’s Tesla gigafactory.
It manufactures almost one million Tesla cars a year and produces more than half of all its cars worldwide.
But with US president-elect Donald Trump preparing to move into the White House, the relationship between his best buddy Elon Musk and the leadership of China‘s Communist Party is in sharp focus.
Shanghai has been the key to Tesla’s success, largely thanks to the city’s former Communist Party secretary, now China’s premier, Li Qiang.
Chief executive of Shanghai-based Auto Mobility Limited, Bill Russo, says: “Qiang is China’s number two person. His position in Shanghai made everything possible for Tesla.”
“In 2017, China adjusted its policy guidelines for the automotive industry to allow foreign companies to own their factories in China,” he added.
“Tesla signed its deal in 2018, broke ground in 2019, and started producing the Model 3 in 2020.”
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The factory opened at breakneck speak and in record time.
In April, Musk met Li Qiang in Beijing, later posting on X: “Honoured to meet with Premier Li Qiang. We have known each other now for many years, since early Shanghai days.”
Image: Elon Musk met Chinese premier Li Qiang in Beijing in April 2024. Pic: AP
The Musk-China ties go all the way to the top.
When China’s President Xi Jinping visited the US in November 2023, he met Musk, who posted “May there be prosperity for all” – echoing the language often used by China’s government.
Image: Inside a Tesla showroom in Shanghai. Pic: Lex Ramsay
Musk has previously weighed into the debate over the status of Taiwan. Two years ago, he suggested tensions could be eased by giving China some control over Taiwan.
This comment incensed Taiwan’s leaders.
Chinese commentator Einar Tangen, from the Taihe Institute in Beijing, says: “If Musk had said anything else, he could face action against the Shanghai plants. He’s not going to endanger that. He’s playing both sides for his own advantage.”
What’s in it for China?
Musk needs China, and in the months to come, China may need Musk.
He could act as a well-connected middleman between the Chinese Communist Party and Trump, in the face of a potential global trade war.
“Like it or not, we are living in a world where China is the dominant player in the race to an electric future,” says Russo.
Musk pioneered the EV industry in China, but is now struggling to compete with local car brands like BYD and Nio.
Image: Elon Musk’s support helped propel Donald Trump to a second term in the White House. Pic: AP
“Donald Trump has never had a problem giving exceptions to friends,” Tangen says.
“It fits his personality, that he can grant pardons and give favours to the people and companies he chooses.”
Musk ‘the pioneer’
Musk is well regarded as a pioneer in China and most people speak of him highly.
Strolling along the Bund waterfront area in Shanghai, Benton Tang says: “Tesla really impacted the entire industry here.
“It pushed people to develop and improve the quality, the design and especially the price.”
Image: Chinese vehicle manufacturers like BYD provide stiff competition for Tesla. Pic: Lex Ramsay
Interest in the Musk family has also gripped China’s online community.
His mother, Maye Musk, frequently visits the country, where she has a huge social media following as a senior-age celebrity fashion icon and endorses several Chinese products including a mattress brand.
Her book, A Woman Makes A Plan, has been translated into Chinese and is a bestseller here.
Image: Maye Musk. Pic: Reuters
Meanwhile, as the countdown to Trump’s inauguration gains pace, the spotlight on the president-elect’s coterie of advisers intensifies.
The Trump-Putin summit is pitched as “transparent” but it’s difficult to find any path to peace right now.
White House press secretary Karoline Leavitt has reduced it to a “listening exercise” where Donald Trump will seek a “better understanding” of the situation.
There isn’t much to understand – Russia wants territory, Ukraine isn’t ceding it – but Ms Levitt rejects talk of them “tempering expectations”.
It’s possible to be both hopeful and measured, she says, because Mr Trump wants peace but is only meeting one side on Friday.
It’s the fact that he’s only meeting Vladimir Putin that concerns European leaders, who fear Ukraine could be side-lined by any Trump-Putin pact.
Volodymyr Zelenskyy claims Mr Putin wants the rest of Donetsk and, in effect, the entire Donbas region in eastern Ukraine.
He’s ruled out surrendering that because it would rob him of key defence lines and leave Kyiv vulnerable to future offensives.
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‘Steps have been taken to remedy the situation’ in Pokrovsk
European leaders – including Sir Keir Starmer – will hold online talks with Mr Zelenskyy twice on Wednesday, on either side of a virtual call with Mr Trump and US Vice President JD Vance.
Their concerns may be getting through, hence the White House now framing the summit as a cautious fact-finding exercise and nothing more.
The only thing we really learned from the latest news conference is that the first Trump-Putin meeting in six years will be in Anchorage.
Alaska itself, with its history and geography, is a layered metaphor: a place the Russians sold to the US in the 1800s.
Donald Trump has said he would try to return territory to Ukraine as he prepares to meet Vladimir Putin and lay the groundwork for a deal to bring an end to the war.
“Russia has occupied a big portion of Ukraine. They’ve occupied some very prime territory. We’re going to try and get some of that territory back for Ukraine,” the US president said at a White House news conference ahead of Friday’s summit in Alaska.
Mr Trump also said: “There’ll be some land swapping going on. I know that through Russia and through conversations with everybody, to the good of Ukraine.”
He said he’s going to see what Mr Putin “has in mind” to end the three-and-a-half-year full-scale invasion.
Image: Donald Trump speaks to reporters at the White House. Pic: Reuters
And he said if it’s a “fair deal,” he will share it with European and NATO leaders, as well as Volodymyr Zelenskyy, who have been liaising closely with Washington ahead of the meeting.
Asked if Mr Zelenskyy was invited to the summit with Mr Putin in Alaska, Mr Trump said the Ukrainian leader “wasn’t a part of it”.
“I would say he could go, but he’s gone to a lot of meetings. You know, he’s been there for three and a half years – nothing happened,” Mr Trump added.
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The US president said Mr Putin wants to get the war “over with” and “get involved” in possible talks but acknowledged Moscow’s attacks haven’t stopped.
“I’ve said that a few times and I’ve been disappointed because I’d have a great call with him and then missiles would be lobbed into Kyiv or some other place,” he said.
Mr Trump said he will tell Mr Putin “you’ve got to end this war, you’ve got to end it,” but that “it’s not up to me” to make a deal between Russia and Ukraine.
Image: Vladimir Putin is set to meet Donald Trump in Alaska. Pic: Reuters
Zelenskyy says Russia ‘wants to buy time’
Ukrainian President Volodymyr Zelenskyy has said Russia “wants to buy time, not end the war”.
“It is obvious that the Russians simply want to buy time, not end the war,” he wrote in a post on X, after a phone call with Canada’s Prime Minister Mark Carney.
Image: Ukrainian President Volodymyr Zelenskyy. Pic: Reuters
“The situation on the battlefield and Russia’s wicked strikes on civilian infrastructure and ordinary people prove this clearly.”
Mr Zelenskyy said the two “agreed that no decisions concerning Ukraine’s future and the security of our people can be made without Ukraine’s participation”, just as “there can be no decisions without clear security guarantees”.
Sanctions against Russia must remain in force and be “constantly strengthened,” he added.
European leaders meet ahead of call with Trump
Meanwhile, European officials have been holding meetings ahead of a phone call with Mr Trump on Wednesday.
The European Union’s foreign policy chief, Kaja Kallas, has been speaking to foreign ministers virtually, saying on X that work “on more sanctions against Russia, more military support for Ukraine and more support for Ukraine’s budgetary needs and accession process to join the EU” is under way.
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‘Russians want to carry on fighting’
Over the weekend, European leaders released a joint statement, welcoming Mr Trump’s “work to stop the killing in Ukraine”.
“We are convinced that only an approach that combines active diplomacy, support to Ukraine and pressure on the Russian Federation to end their illegal war can succeed,” read the statement.
It was signed by UK Prime Minister Sir Keir Starmer, French President Emmanuel Macron, Italian Prime Minister Giorgia Meloni, German Chancellor Friedrich Merz, Polish Prime Minister Donald Tusk, Finland’s President Alexander Stubb, and European Commission President Ursula von der Leyen.
“We underline our unwavering commitment to Ukraine’s sovereignty, independence and territorial integrity,” they said.
Despite Donald Trump’s efforts to convince Vladimir Putin to commit to a ceasefire and negotiations, Russian attacks on Ukraine have only intensified in the past few months.
Ukraine’s president has said that, in the past week, Russia launched more than 1,000 air bombs, nearly 1,400 drones and multiple missile strikes on Ukraine.
On 9 July, Russia carried out its largest aerial attack on Ukraine since the start of the war, launching more than 740 drones and missiles, breaking its records from previous weeks.
Furthermore, Mr Zelenskyy has said Russia is preparing for new offensives.
He described it as a “feel out” meeting “to see what the parameters” are, and stressed “it’s not up to me to make a deal.”
A strategic preemption perhaps, setting expectations low, and preparing the public for failure.
But he remains wedded to the notion that “land swapping” will shape any deal to end the war in Ukraine.
“Good stuff” and “bad stuff” for both sides, he said, positioning himself as the pragmatic mediator between the two.
He expressed irritation with Mr Zelenskyy’s assertion that he doesn’t have the constitutional power to concede land, though did say he hopes to get “prime territory” back for Ukraine.
Image: Volodymyr Zelenskyy will not be attending the summit. Pic: AP
The dealmaker-in-chief
Mr Trump promised to brief the Ukrainian president and European leaders immediately after his meeting with Mr Putin.
And he voiced confidence in his ability to quickly assess the potential for a deal, boasting his business acumen.
“At the end of the meeting, probably the first two minutes, I’ll know exactly whether or not a deal can be made,” he said.
Asked how he would know, he replied: “That’s what I do, make deals.”