Tesla shares surged 15% on Monday after CEO Elon Musk secured approval to roll out “Full Self Driving” technology in China after a whirlwind weekend trip to the country.
Top Chinese officials gave Tesla tentative permission to launch the software following a meeting with Musk during his surprise trip to Beijing. Tesla will rely on Chinese tech giant Baidu’s mapping license for navigation on public roads, people familiar with the matter told the Wall Street Journal.
During his trip, Musk met with top Chinese officials, including Premier Li Qiang, who previously helped clear the way for Tesla to launch its production facility in Shanghai. The exact timing of a FSD rollout was not immediately clear.
“Honored to meet with Premier Li Qiang,” Musk wrote. “We have known each other now for many years, since early Shanghai days.”
Local approval for full self-driving could provide a major boost to Tesla in China – the world’s largest auto market – at a time when his electric car firm is struggling with sagging sales. Tesla has also faced fierce competition from Chinese manufacturers such as BYD.
The EV pioneer’s stock has surged more than 35% in the past five days, closing at $194.05 on Monday, but is still down more than 20% on the year.
Tesla’s deal with Baidu helped to reassure officials in Beijing about data privacy risks, sources told the Journal.
The firm has stored all data related to its Chinese business in Shanghai since 2021 as part of a compliance deal with local regulators.
The Baidu deal was “clearly key to getting the green light from Beijing,” according to Wedbush analyst Dan Ives.
“This is a key moment for Musk as well as Beijing at a time that Tesla has faced massive domestic EV competition in China along with softer demand,” Ives said in a note to investors. “While the long term valuation story at Tesla hinges on FSD and autonomous, a key missing piece in that puzzle is Tesla making FSD available in China which is now a done deal.”
Musk is also seeking approval to transfer data from its Chinese fleet overseas to help train its driving software, a source familiar with the situation told Reuters.
Tesla did not immediately return The Post’s request for comment.
Full Self Driving is the most advanced version of Tesla’s semi-autonomous driver assistance software, which has drawn a positive response from the company’s loyalists as well as intense scrutiny from safety regulators in the US.
Last month, Musk reportedly implemented a “hard requirement” that all potential Tesla buyers receive a demonstration of the FSD technology, including a test ride, before they receive their vehicle.
Earlier this month, Tesla slashed the price of FSD in the US to $8,000 from $12,000. FSD is also available through monthly subscriptions, the price of which was cut to $99 from $199.
Tesla says its Autopilot and Full Self-Driving products “are intended for use with a fully attentive driver, who has their hands on the wheel and is prepared to take over at any moment.”
The National Highway Traffic Safety Administration has conducted a long-running investigation into the potential role of Tesla’s software in hundreds of vehicle crashes.
Last year, Tesla issued an over-the-air recall to add “additional controls and alerts” nudging drivers to pay attention while using Autopilot.
