Musk visits China amid rumours Model 3 refresh production imminent

China is a huge market for Tesla and sales are growing rapidly. Insurance data shows that Tesla has had record sales every week in Q2 of 2023. Elon Musk has met with China’s Foreign Minister Qin Gang and the chair of battery giant CATL during the first days of his trip to China which will also include his first visit to Tesla’s Shanghai giga-factory in three years.

Aside from strengthening relations with Chinese government officials and suppliers, there’s also speculation that Musk’s visit may coincide with the launch of the much anticipated Model 3 refresh.

The meeting with Zeng Yuqun, the founder and chairman of CATL, the world’s biggest battery maker and a key supplier to Tesla, is particularly significant.

Tesla recently started using BYD batteries in its Model Y produced in Berlin, but it’s expected that Tesla will start using CATL’s new MP3 batteries in its vehicles later this year.

Earlier this week Teslarati reported that the Model 3 production line at the Shanghai factory was halting for a period. This was confirmed by drone footage showing output had slowed dramatically.

It’s speculated that the reason for the shutdown is so that the Model 3 production line can be switched over to the new Model 3 design which has a slightly different body as well as significant improvements to cameras, as well as an upgrade to the Hardware 4 computer.

All Model 3 and Model Y vehicles sold in Australia are produced at the Shanghai factory, so if the rumours are true we may soon see the refreshed Model 3 on Australian roads.

The trip comes as tensions between China and the US have been rising. Musk believes that any escalation would have a catastrophic impact on both country’s economies and the rest of the world.

During an interview with Wall Street Journal last week Musk was asked what he thinks about the current geopolitical tensions between the two nations.

“There is fundamentally an issue that’s coming to a head with Taiwan. And it’s unclear exactly whether push will come to shove, but it seems that there’s a good chance that push will come to shove. It’s treading in that direction,”

“I dread to think what would what would happen. The results for the global economy would be absolutely catastrophic.”

The WSJ interviewer made the point that a lot of the world’s high-end chips come out of Taiwan and asked Musk how catastrophic it would be if supply was cut off.

“Well there’s even more that come out of China.” said Musk “China does so much of the world’s heavy lifting on manufacturing,”

“China just does an immense amount of hard work, most people have no idea how much hard work they do. So being cut off from Taiwan is much less of a concern than being cut off from China. China would or reciprocally suffer too of course,”

“The economies of China Taiwan are like conjoined twins with the Western economy and with the rest of the world,” said Musk.

“The separation is going to be dire indeed, I hope does not happen,”

“If there’s any if there’s any path to a diplomatic solution, we should really take that seriously.”

In a statement yesterday China’s Foreign Min Qin Gang used Tesla as an analogy for  Sino-US relations.

“We need to keep the steering wheel in the right direction of mutual respect, peaceful coexistence, and win-win cooperation proposed by President Xi Jinping; timely “step on the brakes” and avoid “dangerous driving” ; Be good at “stepping on the gas pedal” to promote mutually beneficial cooperation.”