【By Observer Net, Xiong Chaoran】 Recently, due to a tax and spending bill, U.S. President Trump and billionaire Musk have completely fallen out. Trump threatened to deport Musk, who was born in South Africa, while Musk vowed to establish a new political party.

On July 14, the Hong Kong South China Morning Post reported that the tense and confrontational relationship between these two individuals has intensified, sparking speculation about whether Musk might move his business empire to China. "If the tension between Musk and Trump escalates—especially regarding regulation, subsidies, censorship, or taxes—Musk may transfer more research and development or manufacturing capabilities abroad," said Denis Simon, a non-resident fellow at the Quincy Institute for Global Affairs, a prominent new think tank.

"China has advanced supply chains and infrastructure, which could become an attractive (destination) for relocation," Simon pointed out: "Although Musk cannot fully transfer his business empire to China due to export controls and national security barriers, selective knowledge transfer, symbolic alliances, and manufacturing migration are very likely."

However, Simon also stated that although it is currently feasible for Musk to move his electric vehicle business to China, transferring other businesses, especially SpaceX, would be more difficult. "SpaceX's role in U.S. defense, satellite communication, and space launch services makes it essentially non-transferable," he said: "If Musk attempts to transfer key space technology to a geopolitical rival, he could be seen as a threat to U.S. national security."

May 30, Trump and Musk in the White House Oval Office. Visual China

Simon believes that China has a favorable electric vehicle supply chain, policy incentives, and consumer base for Tesla, but transferring all intellectual property to China would trigger political backlash in the United States, especially regarding patent technologies. He also added that Tesla's business in China helps accelerate the development of local electric vehicle companies.

In 2020, Tesla accounted for more than 16% of total sales of electric vehicles in China, but this share dropped to 6% last year due to increasingly fierce competition from Chinese competitors such as BYD and XPeng.

Zhou Yu, a professor of geography at Vassar College who studies globalization and China's high-tech industry, stated that in fact, China has already surpassed the United States in electric vehicle technology.

"Overall, Musk's words and actions may influence people's perceptions of China, but he will not change China's innovation focus or environment," Zhou said: "Transferring R&D to China would be difficult, so he may expand his business in China, but the electric vehicle commercial ecosystem in China is already mature, so there is little that Musk can change."

Additionally, Simon mentioned other issues that Musk's other businesses might face when establishing operations in China, including Neuralink, the brain-computer interface (BCI) company, and Boring Company, which is developing a proposed Hyperloop transportation network.

"Musk's Hyperloop concept is more successful as an inspiration source than as a real project," Simon said. Although China has long been a leader in the global high-speed rail sector, if Musk really tries to build a Hyperloop prototype in China, it could still serve as a technological demonstration for future transportation systems.

He added that regardless of Musk's future, the Chinese side can use his case and complaints about the U.S. political system to demonstrate that the U.S. is no longer an ideal environment for disruptive innovation.

"China wants to benefit, perhaps without Musk's loyalty or direct investment; just his marginalized situation in the U.S. is enough to strengthen China's own tech narrative: China is a stable innovation center aligned with national development goals, less hindered by ideology," Simon believes that this signal may target foreign investors, young Chinese scientists currently in the U.S., or countries seeking non-Western models.

The South China Morning Post reported that after Trump and other Republicans threatened to deport Musk, some Chinese social media users have expressed welcome to Musk.

A netizen commented: "If he has no country, China welcomes Musk, and Tesla cars will become cheaper." Another netizen wrote: "Then come to China. China will certainly welcome these wealthy, creative, and innovative talents."

Earlier this month, as Trump signed the "Big and Beautiful" tax cut and spending bill, his conflict with Musk intensified again. On July 1st local time, Trump posted on social media, directly targeting the government subsidies received by Musk's companies, and proposed that the "Department of Government Efficiency" (DOGE) conduct an investigation.

He wrote: "So far, Musk has received more subsidies than anyone in history. Without subsidies, he might have had to close down and return to South Africa. No rocket launches, satellites, or electric vehicle production. Our country could save a lot of money. Maybe we should let DOGE do a thorough and serious investigation? That could save a lot of money!"

According to The Washington Post, so far, Musk's business empire has received $3.8 billion in government contracts, loans, subsidies, and tax credits.

Simon pointed out: "Deportation or visa pressure is politically explosive. Musk's background of being born in South Africa and holding Canadian nationality theoretically allows him to be deported, but any attempt to deport him would be a legal and political nightmare—unlikely even during Trump's administration."

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