Musk Highlights China’s Power Surge as US Industrial Gap Widens
1min read Tesla CEO Elon Musk recently commented on the X platform, stating that industrial capacity is closely related to power generation, with China having significantly surpassed the United States in this regard.
This statement was made in response to a user who shared a chart from the Energy Institute's "World Energy Statistical Yearbook" (2024 edition). The data indicates that after 2005, China's power generation exceeded that of the U.S. and has continued to grow steadily, widening the gap by 2023.
Industrial capacity can indeed be approximated by power generation, as the cost of storing electricity is high, leading to generation closely matching demand. With residential and agricultural electricity usage accounting for a small percentage, industrial power consumption accounts for about 65%. Therefore, power generation is a good representation of industrial capacity.
China's comprehensive industrial system, encompassing all sectors, ensures its power generation will keep increasing, boosting its industrial capacity. Conversely, the U.S. has seen a decline in its industrial base following its industrial transformation, leading to increased reliance on Chinese manufacturing across various sectors.
This transformation partly explains America's recent imposition of tariffs on electric vehicles imported from China, a move contrary to free trade principles. Meanwhile, U.S. automakers show less enthusiasm for electrification, partly due to the disruption it brings to traditional business models reliant on combustion engines.
Tesla, unlike American automotive giants, is seen as a pioneer in this field. However, its stability compared to established players like General Motors and Ford remains a topic of interest. The company's future strategy between expanding overseas and consolidating its domestic market presence continues to be watched closely.