(Nov 27): A senior Tesla Inc executive highlighted the electric vehicle maker’s close partnerships with Chinese manufacturers following a report that it was looking to shift away from some China-based suppliers.
“A supplier’s country of origin does not constitute an exclusionary standard,” Grace Tao, a Tesla vice-president in China, wrote on Weibo Wednesday. The company applies “the same strict, objective standards” for supplier selection across its production bases in the US, China, and Europe, she wrote on the social media platform.
Tao’s comments follow a Wall Street Journal report earlier this month that Tesla planned to stop using Chinese-made components in cars assembled in the US. Reuters has said General Motors Co is undertaking similar measures.
Carmakers’ scrutiny of their suppliers has intensified alongside rising geopolitical tensions between Washington and Beijing. But it’s unclear how easily American manufacturers can move away from China given the latter’s dominance across the complex network that makes up the auto supply chain.
Tesla has been trying to reduce its dependence on China-made components for its US cars since Covid, with President Donald Trump’s imposition of hefty tariffs on Chinese imports accelerating the strategy, the Wall Street Journal said, citing people it didn’t identify.
The carmaker’s Chinese operations are significant, with its Shanghai factory not only its largest production hub but also serving as a primary export centre for markets in Asia and Europe.
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Tesla’s procurement decisions are based on quality, total cost, technical maturity and the continuity of long-term supply, Tao wrote.
Tao also wrote that Tesla currently works with more than 400 supply chain partners in China. Of those, the automaker has integrated more than 60 Chinese vendors into its global procurement system, a move she said helps these companies enter the “world stage.”
Uploaded by Magessan Varatharaja
