Illustration: Xia Qing/GT

Writing on social media platform X that "our Shanghai factory is running at max capacity," Tesla CEO Elon Musk on Sunday lashed out at news reports claiming his company's market share was declining in China amid increasing competition from Chinese domestic automakers. 

Citing data from Tesla, Reuters reported on September 3 that the US electric vehicle (EV) giant sold more than 63,000 cars in China in August, a hefty 37 percent jump from July. Any changes in Tesla's sales in China always draw attention from Western media outlets. It is precisely due to the importance of the China market to Tesla that its sales in the country are closely watched.

China is Tesla's second-largest market after North America, according to media reports. Tesla has sold more than 1.7 million cars in China since it entered the market one decade ago. 

Obviously, Musk wants people to have confidence in Tesla's performance in China. For Tesla, China is indispensable, in terms of not only sales but also manufacturing. The Tesla Gigafactory in Shanghai, which was established in 2019, is the carmaker's first Gigafactory outside the US. 

Although policy uncertainty around Chinese EV exports to major markets like the US and Europe continues, the full operation of its Gigafactory in Shanghai indicates the irreplaceability of the China market and supply chain to Tesla.

Whether or not Tesla's market share in China slips, it doesn't change the fact that the China market provides tremendous opportunities for Tesla and holds an important position in its global manufacturing strategy, laying a solid foundation for its global performance. 

Tesla is facing intense competition in China, where market conditions are so demanding that any automaker must work hard and make arduous efforts to maintain its market share.

Although Tesla faces fierce competition from local brands in China, the US car producer still enjoys high brand awareness among Chinese consumers. This is not because China is giving Tesla more favorable treatment than to other foreign brands, but because some consumers prefer Tesla and believe its EV models have an advantage. 

Whether Tesla can maintain its market share in China will depend on whether it can maintain its advantage. It is the fierce and fair competition in China that will force Tesla to keep updating its technology and improving its ability to achieve good sales in the China market. 

In addition, only by staying in China, further integrating into China's industrial chain and fully utilizing China's advantages in the EV sector can Tesla enhance its strength and achieve better results in global competition.

The strength of China's EV industry stems from a combination of factors that drive technological innovation and industry growth. These include a strong supply chain, significant industrial clusters and a large market.

China boasts the most complete industrial system in the world, having maintained its status as the largest manufacturing country for more than one decade. Leveraging this robust manufacturing foundation, China's EV sector has developed the most complete EV industrial ecosystem that includes material research and development, engineering design, manufacturing management and final assembly. 

China's massive EV market and strong growth potential also hold great attractiveness for foreign investment. In 2023, the sales of new-energy vehicles (NEVs) in China reached 9.5 million units, accounting for more than 60 percent of the global market, the Xinhua News Agency reported.

China has consistently adopted a welcoming stance toward foreign investment, actively encouraging international enterprises to invest in and collaborate within the country to foster mutual growth. Meanwhile, China seeks a fair and equitable business environment from certain Western countries to support sound bilateral investment and trade for Chinese companies.

It has been repeatedly proved that protectionism and political interference in normal economic and trade cooperation inevitably result in a lose-lose situation. By prioritizing short-term political gains over collaborative economic strategies, countries risk slowing their industrial progress and diminishing global trade opportunities.

By removing trade barriers and unreasonable restrictions, both parties can realize mutual benefits and foster the accelerated growth of the EV and other new-energy industries. It is essential that enterprises from different countries operate on a foundation of equality and mutual trust, and collaboratively advance the sound development of the global industrial chain and market.

The author is a reporter with the Global Times. bizopinion@globaltimes.com.cn