By David Shepardson
WASHINGTON (Reuters) -The top Democrat on the House of Representatives Appropriations Committee said on Friday that Republicans in Congress were protecting Elon Musk’s Chinese investments by removing provisions limiting U.S. investments.
Rep. Rosa DeLauro said in a letter that Musk, CEO of electric car maker Tesla (NASDAQ:), may have upended the government financing process by removing a provision that would regulate U.S. investments in China, given his “extensive investments in China in key sectors and his personal ties to the leadership of the Chinese Communist Party, casting doubt on the real reason for Musk’s opposition to the original financing deal.
Tesla did not immediately respond to a request for comment. Musk posted a number of messages critical of DeLauro on X on Friday, including one that said she “should be kicked out of Congress!”
President-elect Donald Trump has named Musk, a billionaire, as co-head of a project to cut government costs. Musk helped lead online opposition to a government financing bill that would have included Chinese investment restrictions.
“Musk’s investments in China and his ties to the Chinese Community Party have only grown in recent years, with Tesla’s Shanghai factory producing about 50 percent of Tesla’s global car output,” DeLauro wrote.
Nearly a quarter of Tesla’s global revenue in 2023 came from selling Chinese-made vehicles from its Shanghai factory, DeLauro said, adding that Tesla broke ground on a $200 million factory in China to make large batteries that are crucial for the electric vehicle supply chain.
She added that proponents of regulating U.S. investments in China “have advocated for the inclusion of large battery production in the list of technologies subject to outbound investment screening.”
In October, the Treasury Department finalized rules effective Jan. 2 that will limit U.S. investment in artificial intelligence and other technology sectors in China that could threaten U.S. national security.
On the House floor, DeLauro vowed to keep fighting for supplies. “This is something that simply needs to be done to protect our supply chains and our critical capabilities,” she said, adding that Musk had “bullied Republicans into going back on their words.”
