Donald Trump and Elon Musk could fall out over China if massive tariffs are levied on the nation, it has been claimed.
The pair became strong allies during the election campaign and the billionaire was made co-chief of the ‘Department of Government Efficiency’.
The Tesla and SpaceX boss even shelled out hundreds of millions of dollars to bolster Trump’s campaign.
Though they agree on many issues, the pair may be opposed on what to do about China, which experts warned could split them apart.
‘Trump and Musk could fall out because Musk ends up opposing tough economic policies on China,’ Neil Thomas, fellow at the Asia Society Policy Institute, told Newsweek.
Trump has already nominated Marco Rubio to be secretary of state and Mike Waltz to be national security advisor – both hawks on China, likely to push a hard line.
He talked tough on China also, both as president the first time and during the campaign against Kamala Harris.
One of Trump’s signature policies is up to 60 per cent tariffs on Chinese goods entering the US and removing some trade perks the country enjoys.
‘We have, right now, an $800 billion trade deficit with the world. So think of that,’ he said in a speech in 2018 while he was president.
‘So let’s say we have 500 to 375, but let’s say we have 500 with China, but we have 800 total with the world. That would mean that China is more than half.
‘So we’re going to get it taken care of. And, frankly, it’s going to make us a much stronger, much richer nation.’
The US actually has an $800 billion trade deficit with China alone.
Musk, by contrast, often bent over backwards to make nice with China and its authoritarian regime as it is a huge and growing car market.
About 22.5 per cent of Tesla revenue comes from sales in China, which is tipped to soon be the biggest buyers of electric cars.
Musk routinely complies with Chinese Communist Party demands, including to make a change to Tesla cars in 2021.
He also shut down his factory for four days in 2022 during a Covid outbreak when he was told to, despite calling California health authorities ‘fascists’ for making the same order in 2020.
Tariffs on China are also not in Musk’s best interests and he railed against ones President Joe Biden put on earlier this year.
‘Neither Tesla nor I asked for these tariffs. Things that inhibit freedom of exchange or distort the market are not good,’ he said at a tech conference in Paris.
‘Tesla competes quite well in the market in China with no tariffs and no deferential support. I’m in favor of no tariffs.’
Oxford University presidential historian Laura Smith said Trump may have appointed people with diverse views on China because his policies are unclear.
‘He may have more disagreements during his second term based on policy with his increased exposure to different issues,’ she said.
‘The fact that he has chosen people with diverse views on China to serve may indicate his current lack of decisive policy.’
Smith said it was also possible Musk could end up shaping Trump’s policies on China, or at least moderating them.
‘Now that Trump and Musk appear so close, it would seem that Trump would want to keep him on side considering the wealth of resources Musk has to denigrate an opponent,’ she said.
Thomas said if this happened, Trump may instead clash with cabinet members like Rubio and Waltz.