Musk’s big win in China: Tesla clears data security, full self driving hurdles for locally-made cars – ET Auto


This came close on the heels of Tesla introducing fresh incentives in the world’s largest auto market to attract consumers.

Tesla CEO Elon Musk‘s surprise visit to China has proven to be a strategic move yielding significant results. The Tesla boss has managed to get a key clearance from China that will be a big shot in the arm for the behemoth EV maker’s efforts to resurrect declining sales and win trust in China where their own automakers such as BYD have threatened Tesla’s dominance.

Tesla’s cars made in China passed key data security and privacy requirement in China, handing Musk a major win who visited Beijing to seek approval to introduce driver-assistance software. This is according to the China Association of Automobile Manufacturers. Before, some places in China banned Tesla cars because they were worried about how they collected data.

Meanwhile, Reuters reported citing sources that Baidu, a prominent Chinese internet search company, has reportedly struck a deal with Tesla, allowing the car manufacturer access to its mapping license for gathering data on public roads in China.

Tesla Inc.’s locally made cars have cleared a key data security and privacy requirement in China in a boost for Elon Musk, who made a surprise weekend visit to Beijing to try to win approval to introduce driver-assistance software. Reports thus indicate that Chinese authorities may remove restrictions on Tesla vehicles following the company’s compliance with the nation’s stringent data security protocols.

Bloomberg reported that the data security assessments encompassed the methods by which vehicles gather “sensitive personal information” and the ease with which drivers can halt data collection, as stated by the China Association of Automobile Manufacturers in a late Sunday statement. Previously, Tesla vehicles had faced bans from Chinese military installations and certain governmental sites due to apprehensions regarding data collection.

Alongside Tesla’s Model 3 and Model Y, several other new energy vehicles manufactured by BYD, Lotus, Nezha, Li Auto, and Nio have also met China’s stringent data security standards.

Elon Musk, pivotal in addressing this matter, made a low-key arrival in mainland China on Sunday. He held discussions with Premier Li Qiang.

Following the meeting, in the evening of April 28th, the China Association of Automobile Manufacturers released a statement affirming Tesla’s compliance with pertinent data security standards. Consequently, restrictions will be progressively eased in different regions. The statement underscored that all Tesla models manufactured at the Shanghai Gigafactory adhere to these regulations, distinguishing Tesla as the sole foreign entity to achieve such compliance, according to media reports.

During his unexpected trip to Beijing, Musk was anticipated to engage with senior officials to deliberate on the deployment of Full Self-Driving software and the authorization for data transfer abroad, as per Reuters, citing an informed source.

In response to a query on the social media platform X, Musk indicated earlier this month that Tesla might imminently offer Full Self-Driving capabilities to customers in China.

Since 2021, Tesla has been storing all data gathered by its Chinese fleet in Shanghai, complying with Chinese regulatory mandates, and refraining from transferring any data back to the United States.

Musk’s trip to China came shortly after he cancelled a scheduled trip to India to meet Prime Minister Narendra Modi, citing “substantial Tesla commitments.”

Tesla is seeking to woo China, a key market for the EV maker, and just a week back it had reduced prices for all its vehicles in China.

This came close on the heels of Tesla introducing fresh incentives in the world’s largest auto market to attract consumers. These incentives included insurance subsidies, as the U.S. electric vehicle giant engaged in a prolonged price battle against established competitors.

The U.S. electric vehicle-maker is grappling with slow demand and strong competition in China, while its first-quarter sales dropped sharply below market estimates. Tesla’s global vehicle deliveries experienced a decline in the first quarter, marking the first decrease in nearly four years.

Tesla is dealing with tough competition worldwide, especially from Chinese electric car companies. These companies are flooding the market with cars priced as low as USD 10,000. Meanwhile, Tesla has decided not to make the affordable car they had promised. Investors were hoping for this car to help Tesla become a big car company for everyone.

Musk had last week deferred his visit to India and planned meet with Indian Prime Minister Narendra Modi. He was also set to meet with senior officials from state governments where Tesla is considering establishing an electric vehicle assembly unit. India had recently offered a new EV policy with lower import tariffs, laying out the red carpet for entry of foreign automakers such as Tesla.

  • Published On Apr 29, 2024 at 11:15 AM IST

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