Elon Musk’s purchase of Twitter could spell disaster for the social media platform because there’s a danger China may leverage Tesla’s footprint there to force him to censor content online, in accordance with an authority.
Scott Sheridan, the CEO of online brokerage platform Tastyworks, told The Post that Musk’s $44 billion acquisition of Twitter doesn’t bode well for the social media company in addition to his other prized businesses — Tesla and SpaceX.
“I actually have a difficult time believing Elon’s purchase of Twitter can possibly end well,” Sheridan told The Post.
Musk, the world’s richest person whose personal wealth — valued by Forbes at $241 billion — is derived mainly from his stake in Tesla, has deep business ties to China.
Tesla’s largest factory is in Shanghai, China’s financial hub. It’s the only China-based factory that’s fully owned and operated by a non-Chinese entity.
To ensure that US-based corporations to do business in China, the federal government in Beijing normally requires that they form “joint ventures” with domestic firms. Tesla was exempt from this stipulation.
Tesla’s access to the lucrative electric vehicle market in China might be used as leverage by the federal government in Beijing, experts warn.REUTERS
Tesla’s access to China — the world’s largest electric vehicle market — has paid enormous dividends. Last 12 months, Tesla sold $13.8 billion price of electrical cars to Chinese consumers — which accounts for 1 / 4 of the corporate’s worldwide revenue.
In 2021, Tesla sold greater than 470,000 electric cars that were manufactured in its Shanghai gigafactory. That’s greater than half the variety of vehicles that Tesla has sold worldwide.
Tesla’s growing reliance on China could give the Communist Party-run government leverage over Musk once he acquires Twitter.
Musk has vowed to take Twitter private and liberalize its content moderation policies with a view to allow for more free speech.
But Sheridan predicted that China may squeeze Musk in an effort to force him to tailor Twitter’s censorship policies so that they’re aligned with Beijing’s political interests.
“China embraces free speech about in addition to [Chicago] Bears fans embrace [Green Bay Packers quarterback] Aaron Rogers at their dinner table,” Sheridan said.
He predicted to The Post that if Musk plays ball with China, that might endanger SpaceX’s contracts with NASA.
China is home to Tesla’s massive gigafactory within the financial hub of Shanghai.AP
“If Elon’s history on Twitter isn’t cause for concern and you suspect he’ll in actual fact take this seriously, you continue to can’t get across the potential conflicts he’ll encounter with respect to China and even the US government,” he said.
“You don’t must try too hard to ascertain a scenario where China exerts pressure on Elon to censor criticism,” Sheridan continued.
“And any potential special treatment with respect to China could potentially cost SpaceX existing and/or future US government contracts.”
After Musk’s $44 billion bid for Twitter was approved by the corporate’s board of directors last month, billionaire rival Jeff Bezos wondered whether the deal would find yourself empowering China.
Analysts warn that China could force Musk to censor Twitter if he’s intent on maintaining Tesla’s footprint there.Bloomberg via Getty Images
“Interesting query. Did the Chinese government just gain a little bit of leverage over the town square?” Bezos asked.
He shared a Recent York Times reporter’s tweet that noted how China was the second-biggest marketplace for Tesla, Musk’s pioneering electric automotive company that also opened its first overseas factory in Shanghai.
Twitter is blocked in China, giving it no leverage over the location — which the Bezos-shared conspiracy suggested could change under Musk.
Soon after getting 1000’s of reshares for his tweet, Bezos followed up by admitting he did not likely imagine it.