Without any prior notice, Tesla’s CEO Elon Musk suddenly met with Chinese Premier Li Keqiang. Experts analyzed that the Chinese government’s meeting with Musk indicates their difficulties in restoring foreign companies’ confidence and also reflects the bottleneck faced by the domestic electric vehicle industry in China.
On April 28, Chinese state media prominently reported the meeting between Li Keqiang and Musk at the Diaoyutai State Guesthouse in Beijing. This unexpected encounter came amid the ongoing Beijing Auto Show, where Tesla was notably absent. There were also no expectations for Musk’s visit to China by domestic auto companies. Reuters described Musk’s visit as “an unexpected one.”
At a time of economic downturn in China, rebuilding confidence in foreign investment and improving trade relations with the United States have become key themes in the Chinese government’s recent external propaganda.
Chinese state media highlighted Li Keqiang’s reassurance to foreign businesses during the meeting with Musk. Li emphasized that foreign enterprises are vital participants and contributors to China’s development, emphasizing that China’s vast market will always remain open to foreign businesses.
Furthermore, Li highlighted Tesla’s development in China as a successful example of Sino-US economic and trade cooperation.
Associate Professor Chen Shimin from the Department of Political Science at National Taiwan University told reporters that the Chinese government is currently facing a shortage of foreign investment, particularly with a significant decrease in foreign investment over the past year, which has been an important factor hindering China’s economic growth.
Chen believes that the Chinese government has been attempting to attract foreign investment back and restore confidence in China’s economy. Musk, as a representative figure from a foreign enterprise, holds symbolic significance, especially considering Tesla’s factory in Shanghai. Li Keqiang’s reception of Musk is a message to other foreign companies, aiming to boost their confidence and encourage them to invest heavily in China.
Consultant at a Taiwanese think tank and researcher at the Cross-Strait Policy Association, Wu Sezhi, told reporters that Tesla, under Musk’s leadership, possesses a certain level of technological capability. China is attempting to showcase its continued welcome of foreign investment through this approach.
Wu believes that China also aims to demonstrate to its domestic audience that they can have confidence in the introduction of high-tech. “The Chinese government has its calculations, especially now that the Chinese economy is facing challenges. Musk’s visit and Tesla’s potential expansion in the Chinese market are advantageous for China.”
In 2018, Tesla was approved to establish a sole-owned electric vehicle factory in China. The Shanghai factory commenced production in October 2019 and officially delivered the China-made Model 3 in January 2020. Currently, China is Tesla’s second-largest market and serves as an export base for the company.
Foreign media reports suggest that Musk’s visit to China is to push for the implementation of Tesla’s Full Self-Driving (FSD) system in China and seek approval from the Chinese authorities to transfer driving data collected in China to overseas for autonomous driving algorithm training.
The relevant authorities in China and Tesla China have not released any official announcement regarding this matter.
FSD is an advanced version of Tesla’s Autopilot driver assistance system, with Tesla aiming to gradually upgrade FSD to achieve full autonomous driving.
Public information indicates that as per regulations from Chinese regulatory authorities, all driving data collected by Tesla in China since 2021 is currently stored in Shanghai and has not been transmitted to the United States.
Earlier in April, Musk announced on social media platform X that he plans to introduce FSD technology to Chinese users “very soon.” Industry experts pointed out that the complex traffic conditions in China, with more pedestrians and cyclists on the roads, make driving data in this context crucial for training intelligent driving algorithms.
Chen Shimin mentioned that negotiations between Musk and Chinese authorities regarding the implementation of Tesla’s FSD software in China may lead to some consensus at a certain stage.
He noted that the Chinese government is cautious and wary about Tesla transferring all driving data collected in China to the United States, as this could involve sensitive information, including military bases and confidential locations like Zhongnanhai. China is hesitant to fully transfer such data to the US.
In response to Li Keqiang’s statement, the China Association of Automobile Manufacturers and the National Computer Network Emergency Response Technical Coordination Center issued a notification on April 28 regarding the 4 security requirements for handling automotive data.
Tesla’s models manufactured in Shanghai meet all of the 4 requirements: anonymization of external facial information, non-collection of cabin data by default, internal processing of cabin data, and clear notification on the processing of personal information.
Quoting sources from Tesla, The Paper reported that Tesla meets the authoritative standards and requirements on national vehicle data security, which will contribute to the comprehensive lifting of restrictions on Tesla’s intelligent vehicles in various areas such as government units, airports, and highways.
During Tesla’s first-quarter earnings call on April 23, Musk stated that FSD can operate normally in almost all countries without modification, akin to renting a car abroad and driving it effortlessly. “We plan that as soon as we get approval from any country’s regulatory authority, we will launch a supervised FSD system there, and I believe this includes China.”
With China’s economy showing no signs of improvement and foreign investment withdrawing, can the Chinese government’s move to “open up the market” for Musk help regain confidence from foreign enterprises? Chen Shimin expressed skepticism regarding this prospect.
Wu Sezhi noted that Musk hopes to expand Tesla’s autonomous driving technology in China, but he still faces existing pressures and substantial risks. Therefore, whether this presents an opportunity for Musk’s Tesla to expand in the Chinese market remains uncertain.
He pointed out that issues related to the application of relevant software for autonomous driving, as well as the use of personal information, involve certain legal regulations within China. This is a concern for international corporations connecting with the Chinese market and also a bottleneck that the Chinese government is currently facing in the development of electric vehicles.