China | Important green light for Tesla, the stock jumps

(Beijing) The American car manufacturer Tesla obtained a decisive regulatory green light from the Chinese authorities in terms of data security during the whirlwind visit to China by its boss, Elon Musk, which ended on Monday. Investors appreciated, the manufacturer’s action rose more than 14% in New York on Monday.

The billionaire arrived in the Chinese capital on Sunday for his second visit in less than a year to the Asian country, the world’s largest automobile market.

Elon Musk notably met the Prime Minister, Li Qiang, with the ambition of consolidating the popularity of his cars in the country, which must compete with fierce local competition.

On Sunday, models built in China by Tesla were officially included on the list of vehicles meeting national data security requirements. This is the removal of a major regulatory obstacle.

Elon Musk left in his private jet from Beijing Capital Airport on Monday.

Despite strong competition from Chinese companies, Tesla cars are among the best-selling in China.

The automaker hopes to boost sales in the Asian country with its “fully autonomous driving” feature (Full Self Driving or FSD in English), already offered in the United States.

This assisted driving technology would be close to obtaining a green light from the authorities for use in China, thanks to a partnership with the local internet giant Baidu for maps and navigation, according to the Bloomberg agency.

Asked by AFP, Tesla did not immediately respond.

“If Musk manages to obtain authorization from Beijing to transfer data collected in China abroad, it will be a pivotal moment to accelerate the training of the algorithms of his autonomous technology at the global level,” commented analysts at Monday. Wedbush, noting that Tesla has kept data from its vehicles in China since 2021.

Tesla’s stock, which has suffered a loss of more than 40% since the start of the year, was on turbo, jumping almost 15%, to $192, around 2:30 p.m. on the New York Stock Exchange.

Loss of competitiveness

The China Association of Automobile Manufacturers (CAAM) said on Sunday that Model 3 and Model Y, two Tesla vehicles produced at its Shanghai mega-factory, complied with data security laws.

CAAM stressed that it has been testing vehicles from several brands since November 2023, with the help of a national IT security regulator, to check how they collect and process data.

According to analysts, FSD could help Tesla stand out in a local market already well stocked with modern, technology-packed Chinese vehicles. The Model 3 and Model Y “have lost their competitiveness,” said Tu Le, general manager of Sino Auto Insights.

“This certainly does not guarantee additional sales, but without FSD, Tesla has nothing new to offer to consumers who are now accustomed to seeing new electric vehicle developments every six or nine months. »

The price could also turn off some customers.

“Tesla’s FSD is not free (…) I don’t think current Chinese Tesla owners are willing to pay to use it,” Zhong Shi, analyst at the Automobile Dealers Association, told AFP. from China. “Many Chinese automakers offer similar functions for free or at a discount. »

China is at the forefront of the transition to electric vehicles.

“Based on current policies, nearly one in three cars on China’s roads by 2030 is expected to be electric,” the International Energy Agency estimated in its recent annual electric automobile outlook report. .

Elon Musk’s desire to secure Tesla’s future in China reflects the importance of this extremely lucrative market for foreign automakers.

Last week, two Japanese auto giants said they would begin partnerships with Chinese technology companies to improve their artificial intelligence capabilities.

Toyota will partner with Chinese video game giant Tencent in an attempt to tap into the growing appetite of drivers in China for smart features.

For its part, the Japanese Nissan intends to cooperate with Baidu, still in terms of artificial intelligence, for vehicles intended for the Chinese market.


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