China and America seemingly can’t stop banning each other’s gadgets, technology and more. The result is a deepening power struggle over who controls the hardware behind the next era of energy and computing. According to a report in Reuters, Chinese officials have held initial talks with providers of equipment to make solar panels as they consider limiting exports of the most advanced technology to the United States. The move reportedly targets the core of the global renewable energy supply chain. China currently produces more than 80% of the world’s solar panel components and is home to the top 10 global suppliers of solar manufacturing equipment. A clampdown solar panel equipment would directly threaten US efforts to localize production and may derail the burgeoning race for space-based computing.The proposed restrictions come at a time when the rivalry between China and the United States has spilled into the race to produce space-based computing powered by solar panels, a focus for Tesla CEO Elon Musk. Other US tech companies such as Google and Amazon are investing in ground-based solar and energy storage systems, even as they count on similar orbital data centers to satisfy AI’s growing demand for power.Incidentally, a recent research report from Trivium China last month said that Tesla’s success in its solar self-sufficiency may prove to be a nightmare for China. It said, “Tesla succeeding in its solar self-sufficiency push could prove a nightmare for China’s world-leading solar manufacturers – who would not only lose a major potential customer, but face the emergence of a new competitor at a time when they are already under massive financial pressure.” At the same time the report also warned, “Beijing won’t sit idly by as its industrial champions inadvertently aid the industrial policy efforts of rivals actively working to reduce their dependence on Chinese solar supply chains. Don’t be surprised if regulators slap new tech export restrictions on solar manufacturing equipment – as they’ve done with the battery industry.”
Bad news for Tesla and Elon Musk
As China is home to a range of cutting-edge solar manufacturing equipment makers, without their products, Tesla would find it extremely difficult to build factories capable of manufacturing modules at the cost and scale required.Also, the proposed curbs come at a sensitive time for American companies. Tesla CEO Elon Musk has been vocal about his ambition to establish 100 gigawatts of solar manufacturing capacity on US soil by 2028. Analysts suggest Beijing is wary of Musk’s attempts to leverage China’s current industry downturn—marked by severe overcapacity—to acquire high-end equipment and talent.
Targets: HJT Technology and Space-Based Power
Sources say the consultations have specifically focused on shipments of high-efficiency equipment, such as that used for Heterojunction Technology (HJT). Reuters previously reported that Tesla was in talks to purchase $2.9 billion worth of equipment from Chinese suppliers, including Suzhou Maxwell Technologies.Three sources reportedly confirmed that Suzhou Maxwell was visited by regulators following reports of their dealings with Tesla. Discussions reportedly centered on restricting the export of the very high-end tools required to produce the next generation of high-efficiency panels.The stakes extend beyond the terrestrial power grid. The rivalry has spilled into the development of space-based computing powered by solar arrays—a primary focus for Tesla and a growing interest for tech giants like Google and Amazon, who are seeking orbital data centers to meet the massive power demands of AI.
Tough timing for US-China relations
If implemented, these controls would mark a significant escalation in the industrial rivalry between Beijing and Washington. It follows China’s decision a year ago to restrict rare earth exports in retaliation for Trump tariffs announced in April 2025. The timing is particularly fraught as officials prepare for a summit between President Xi Jinping and Donald Trump in Beijing next month. While both sides have expressed a desire for stable trade ties, the looming threat of solar export controls suggests the underlying technological competition remains fierce.The message from both sides is said to be clear: While China is prepared to use its dominance in solar components and production equipment as a policy tool, the US, on its part, wants to localize more of the solar value chain on its own soil.
