Tesla is weighing the potential separation of its China business to pave the way for a possible merger with SpaceX. The automaker is considering whether to sell, spin off, or shut down its operations in the region.
This move is being considered due to geopolitical concerns, as it would untangle Tesla's vast Chinese manufacturing from a defense contractor with Beijing exposure. Tesla executives have reportedly been told to prepare for the separation.
The Shanghai facility is a critical part of the company's operations, historically accounting for more than half of the electric vehicle maker's global deliveries. Elon Musk has publicly and flatly denied the reports of these plans.