Tesla's Fatal Strategy

On October 21, 2019, President Trump praised ongoing trade negotiations between the United States and China. Still, as negotiators work towards a deal that would alleviate tensions and reduce tariffs amongst the countries, the trade war persists. And that fact could spell disaster for Elon Musk’s Tesla -- a company banking hard on generous financial assistance from both the United States and Chinese governments. Last year, Musk faced bad news: the United States would be scaling back its subsidies for electric vehicles, known as EV credits. Without the additional support from the federal government, Tesla had to search for a new revenue stream -- and the company found it within China’s regime. Musk, to preserve his business interests, has bet the farm on garnering tax incentives from the Chinese government. And given the ongoing trade war, it’s a risk that likely won’t work out in his favor. Succeeding in penetrating the Chinese market as an American...(Read Full Article)
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