Newly unveiled testimony has revealed that Elon Musk’s SpaceX took money directly from Chinese investors, despite its extremely close ties to the United States military.
As ProPublica reports, major SpaceX investor Iqbaljit Kahlon said during a 2024 deposition that “they obviously have Chinese investors to be honest.”
He said that some of these investors are directly listed as shareholders, highlighting SpaceX’s strong ties to one of the United States’ most prominent international adversaries, and raising concerns that the firm could expose the country to foreign espionage.
The news comes after ProPublica previously reported in March that SpaceX allows Chinese investors to buy a stake in the company — as long as funds are “routed through the Cayman Islands or other offshore secrecy hubs.”
The reporting suggested that SpaceX was trying to avoid scrutiny of its ties to China. Case in point, the company canceled a 2021 deal worth $50 million with a Chinese firm when plans became public, according to ProPublica‘s reporting.
Following the March reporting, Democrats sent a letter to secretary of defense Pete Hegseth and NASA, expressing “concerns about perceived and actual conflicts of interest” surrounding SpaceX.
The “testimony, which arose during a corporate lawsuit in Delaware, suggests that SpaceX may be reluctant to publicly disclose the full extent of Chinese investment into the company’s privately held ownership structure,” the letter reads. “In light of the extreme sensitivity of SpaceX’s work for DoD and NASA, this lack of transparency raises serious questions.”
SpaceX has long been an extremely important military contractor to the Department of Defense, including multimillion-dollar spy and weather satellite launch contracts.
As Ars Technica reported earlier this year, Elon Musk’s space company has been at the receiving end of nearly all recent military launch contracts.
SpaceX was awarded seven Space Force and National Reconnaissance Office launch contracts this year, worth a combined $845.8 million, per Ars. Its competitor, the United Launch Alliance, was awarded only two Space Force launch contracts.
Musk has personally maintained a “kind of pro-China” stance, developing important relationships with the nation for his EV maker, Tesla.
On the other hand, the Trump administration has staunchly opposed Chinese influence, igniting a trade war with the country earlier this year.
The Trump administration has also aimed its sights at China’s tech industry, recently expanding restrictions on it.
However, given SpaceX’s strong ties to China, Elon Musk’s firm could be opening up the US military to significant risks of foreign interference, a topic that’s likely to continue being a major point of contention in Washington, DC.
During a February House subcommittee meeting, New Jersey Democrat LaMonica McIver accused Musk of being China’s “top puppet,” as quoted by the South China Morning Post.
If House members were really concerned, they “would not be OK with handing their constituents’ information over to an unelected billionaire whose true intentions are unknown,” she added at the time.
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