Tesla Criticized For Opening Showroom In China’s Controversial Xinjiang Region

Topline

Tesla opened an electric car showroom last week in China’s Xinjiang territory, a move criticized by a manufacturing group and a U.S. lawmaker, making Tesla the latest American company to face scrutiny over its ties to a region where the Chinese government has allegedly detained scores of Uyghurs and other minority groups.

An aerial view of Tesla’s Shanghai Gigafactory on March 29, 2021.

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Key Facts

Tesla unveiled the new showroom, located in Xinjiang’s capital city of Urumqi, in a celebratory post Friday on Chinese social media site Weibo.

The Chinese-language post read, “let us together launch Xinjiang on its electric journey,” the Wall Street Journal reported.

Tesla has more than two dozen other stores and service centers in mainland China and the semi-autonomous cities of Hong Kong and Macau, according to its website.

Sen. Marco Rubio (R-Fla.), who sponsored a bill signed by President Biden last year that restricts many U.S. imports from Xinjiang, criticized Tesla’s decision and suggested it’s “helping the Chinese Communist Party cover up genocide and slave labor” in a tweet.

The Alliance for American Manufacturing — which frequently questions trade policy with China — called Tesla’s decision “especially brazen” in a statement to Forbes.

The Council on American-Islamic Relations urged Tesla in a statement to shutter the showroom and “cease what amounts to economic support for genocide” — CAIR has often criticized China’s treatment of Uyghurs, most of whom are Muslim.

Tesla did not immediately respond to a request for comment from Forbes.

Chief Critic

“The evidence is clear: China’s government is undertaking a cultural genocide in Xinjiang. Anyone still doing business in the region is complicit,” Alliance for American Manufacturing President Scott Paul said in a statement.

Key Background

Xinjiang has drawn international criticism in recent years, after researchers and reporters found the Chinese government has detained up to a million ethnic and religious minorities — including members of the Uyghur group — in a secretive network of reeducation camps. Researchers say some detainees are subjected to forced labor. China has denied these allegations and insisted its actions in Xinjiang are part of a vocational training and counterterrorism scheme. The Trump and Biden Administrations have accused China of committing acts of genocide in Xinjiang and imposed sanctions on some government entities, and U.S. diplomats plan to boycott next month’s Winter Olympics in Beijing due to China’s human rights record. Some Western corporations that operate in China are caught in the dispute: Human rights groups and U.S. politicians have pressed companies to avoid sourcing materials from Xinjiang or doing business in the region, but companies like Nike and Intel have drawn backlash in China for seeking to cut Xinjiang out of their supply chains.

Tangent

Since delivering its first electric car to a Chinese customer eight years ago, Tesla has viewed the country as a key market for sales and base for manufacturing. The company opened a factory in Shanghai in 2019, and it sold more than 50,000 China-built cars per month in October and November 2021, many of which were exported to other countries, Reuters reported. In September, Tesla CEO Elon Musk vowed to continue investing in research and development in China, which he called a “global leader in digitalization” according to CNBC. Still, the company has occasionally run afoul of the government. Last year, Tesla recalled more than 200,000 cars in China over worries that drivers could accidentally turn on cruise control, and the country reportedly barred some military officials from driving Teslas amid concerns the cars’ built-in cameras could tape sensitive locations, prompting the company to open a data center in China.

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Chief Critic

Key Background

Tangent

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