On April 30th, during a brief visit to Beijing over the weekend, Elon Musk significantly boosted the promotion of Tesla's advanced driving assistance system FSD (Full Self-Driving) in China.
On Monday, Tesla's stock price surged to $194.05 per share, a more than 15% increase, adding $90 billion to the company's market value.
This substantial increase in stock price reflects Wall Street's strong confidence in the electric car manufacturer, especially in the face of challenges such as weak market demand and intense competition.
However, the crucial issue of whether Tesla can transfer data overseas still remains, which is vital for the development of its autonomous driving vehicles.
Reportedly, Musk arrived in Beijing on Sunday for an unexpected visit, working to promote the implementation and data transfer permissions of FSD software in China.
During this visit, Musk achieved multiple accomplishments, including obtaining government approval. The China Association of Automobile Manufacturers stated that the Model 3 and Model Y produced at Tesla's Shanghai Gigafactory comply with data security regulations. Industry analysts believe that Tesla's adherence to national vehicle data security standards and requirements will help lift driving and parking restrictions on Tesla vehicles in various regions.
According to two anonymous sources, Tesla has also reached an agreement with Baidu to use Baidu's map license to collect data on Chinese public roads. They stated that this is a significant step forward for Tesla's FSD implementation in China.
Musk mentioned on the social media platform X earlier this month that Tesla may soon offer FSD software to Chinese customers.
FSD is an upgraded version of Tesla's Autopilot advanced driving assistance system. Over the years, Tesla's advanced driving assistance technology in China has been limited to features like automatic lane changing.
Although the FSD software is named "Full Self-Driving," it is not a fully autonomous driving system in the true sense, as drivers need to be ready to take control of the vehicle at any time.
Tesla has been under scrutiny in the U.S., with the California Department of Motor Vehicles (DMV) suing the company for allegedly misleading advertising of its Autopilot and FSD systems.
In response, Tesla stated that the DMV has been aware of the company's use of these brand names for years and chose not to take action. Tesla believes that California's laws regarding advertising of autonomous driving systems violate freedom of speech.
For Tesla's plans to launch FSD software in China and develop autonomous driving vehicles globally, obtaining approval for data transfer overseas is crucial.
While obtaining approval to sell FSD software and other L2-level driving assistance systems in China may not be difficult, Tesla believes that data transfer permissions are essential for developing autonomous driving vehicles.
Tesla, along with other car manufacturers, relies on vehicle data to train autonomous driving systems, enabling cars to perform increasingly complex tasks without driver supervision. Without approval to transfer data overseas, Tesla would be unable to utilize the data collected in China to develop autonomous driving vehicles for global customers.
Musk's trip to China marks an acceleration in Tesla's strategic shift. The company's strategy has been in need of clarity amidst recent confusion. Tesla is eager to prioritize the development of autonomous driving vehicles while delaying its goal of producing affordable electric vehicles to capture the mainstream market.
Reports in early April suggested that Tesla had abandoned plans to develop a new generation of affordable electric vehicle, Model 2, and instead intends to continue developing autonomous taxis on the same small car platform.
Just a week before the Beijing trip, Musk canceled his planned visit to India and the meeting with Indian Prime Minister Modi. He had intended to discuss investment plans, including building a new factory to produce affordable Tesla vehicles in India.
On Monday, Tesla recorded its largest single-day increase since March 2021. Concerns about Tesla's future performance growth have led to a roughly one-third decline in the company's stock price this year. Last week, Tesla released its first-quarter financial report, showing a decline in quarterly revenue for the first time since 2020.
Competition in the Autonomous Driving Field
Analysts at investment bank Wedbush stated that if Musk obtains approval to transfer data overseas, this visit "will be a significant moment for Tesla."
Industry experts point out that China's complex road conditions, with more pedestrians and electric bike riders compared to many other places, provide more scenarios for faster training of autonomous driving algorithms.
Tesla's breakthrough in promoting FSD software in China signifies a major victory for the company in the fierce competition in the Chinese market. In recent years, domestic Chinese manufacturers such as BYD, NIO, and XPeng have increased competition with Tesla. Companies like XPeng and Huawei have been seeking to launch their own autonomous driving software to gain an edge over Tesla.
XPeng's advanced driving assistance system XNGP is similar to Tesla's FSD software. XPeng's CEO He Xiaopeng welcomed Tesla's FSD entry into China on Weibo.
