The American electric vehicle manufacturer Tesla may sell its Chinese division or move it to a separate structure, The Wall Street Journal reported, citing its sources.
One of the reasons may be the preparation for the merger of Tesla with SpaceX. Both companies are led by Elon Musk. As the publication notes, he structured Tesla's work so that there is a clear boundary between the Chinese and American parts of the business, thus hoping to protect the company in the event of an escalation of the geopolitical confrontation between Washington and Beijing.
SpaceX is a major Pentagon contractor, which imposes significant restrictions on its activities. In the event of a merger between the two companies, separating Tesla's Chinese division from the overall structure would eliminate potential conflicts of interest and regulatory risks.
China is Tesla's second-largest market after the United States, with 18% of sales coming from China in the first half of 2026. There are two major Tesla factories in Shanghai. The electric vehicles and batteries they produce are sold in China and some other countries, but are not shipped to the United States.