Will Elon Musk maintain his ‘throne’ in the billionaire village without China?
Most of the fortune of Elon Musk, the world’s richest billionaire today, is in the form of shares of Tesla, the globally famous electric car empire.
But the irony is that the success of Tesla today, or more accurately, the ability to maintain the effective operation of this empire is greatly dependent on China.
The Nikkei Asian Review reported that nearly 40% of the suppliers of materials for batteries used in Tesla electric vehicles come from the Chinese company.
The Asian powerhouse is also the largest supplier of lithium batteries used in Tesla electric vehicles, accounting for about 39% of 61 firms, thereby showing the dominance of the world’s second largest economy in this segment. .
An investigation by the Nikkei newspaper in conjunction with Fronteo-Japan, which uses algorithmic systems and artificial intelligence (AI) based on financial statements and public information of businesses, has discovered about 13,428 businesses are said to be supplying Tesla at stage 3 of 5 supply chain levels.
Of these, Chinese enterprises account for 40% of 42 companies engaged in the “Nonferrous Smelting” segment, excluding aluminum smelting.
In addition, this country also accounts for 33%, the highest level among 102 factories in the group of “Inorganic Chemistry” supplying Tesla.
The above investigative report clearly shows that Tesla is extremely dependent on the Chinese supply chain.
Critical
According to Nikkei, China is becoming Tesla’s fatal weakness when supply businesses play too large a role in completing an electric car product of Elon Musk’s home.
Based on Fronteo’s Chokepoint Score Index, Chinese businesses have been rated as important to Tesla’s supply chain on a 10-point scale, with the higher the score, the greater the dependence. .
Some extremely important suppliers such as Ganfeng Lithium have a score of 6.8 as a key Lithium supplier to Tesla. Novoray, which specializes in supplying inorganic chemical products, has a score of 7.1, while Zhejiang Huayou Cobalt has a score of 5.7 for Cobalt.
The investigation also shows that firms like Novoray and Huayou Cobalt are heavily influenced by the Chinese government, with the state owning 9% and 12% of shares respectively.
