Home Tech ‘Defining moment’ for Tesla as Elon Musk’s China visit reaps quick payoff

‘Defining moment’ for Tesla as Elon Musk’s China visit reaps quick payoff

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'Defining moment' for Tesla as Elon Musk's China visit reaps quick payoff

Elon Musk’s visit to China has reportedly reaped immediate rewards with a deal for Tesla to use mapping data provided by web search company Baidu, a major step in introducing driver-assistance technology to the broader automotive market. biggest in the world.

Musk made an unannounced visit to China over the weekend. The billionaire posted a photo of his meeting with Chinese Prime Minister Li Qiang on X, the social network he took over in 2022.

Baidu, which dominates web searches in China, will provide mapping and navigation functions to help Tesla operate its driver assistance technology, which it calls “fully autonomous driving” or FSD, according to sources cited by Bloomberg News. Mapping services, crucial for driver-assistance technologies, are tightly controlled by China’s government.

Despite its name, FSD does not provide autonomous driving capabilities: it requires a driver who has “hands on the wheel and is prepared to take control at a moment’s notice.” However, its launch in China could help Tesla in the fierce competition for market share in the country and provide it with more revenue. It costs $8,000, or $99 (£80) a month, although it is not available in many countries.

Musk is often combative in his dealings with politicians, such as in strident criticism of US President Joe Biden or in a showdown in Brazil against a government he claims is censoring X, formerly known as Twitter. However, he adopted a more soothing tone toward China’s second most powerful politician, saying he was “honored” to meet Li.

Musk has a complicated relationship with China due to his various business interests. X is blocked by the Chinese government, which has strict censorship. China’s government has also complained to the UN about close encounters between its space station and satellites launched by SpaceX, Musk’s rocket company.

However, Tesla has a factory in Shanghai and its Model Y was the third best-selling electric or plug-in hybrid car in China in March 2024, according to Clean Technica. BYD, a Chinese manufacturer that competes with Tesla to be the world’s largest seller of electric cars, has the two best-selling models.

Baidu’s visit and report of the deal were greeted enthusiastically by Tesla investors, many of whom are banking on potential self-driving capabilities to justify Tesla’s position as the world’s most valuable automaker. Tesla’s share price rose 6% in pre-market trading in New York.

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Dan Ives, a technology analyst at Wedbush, an investment bank, wrote in a note to clients: “This is a watershed moment for Musk and for Beijing at a time when Tesla has faced massive EV competition in China. along with weaker demand. While the long-term valuation story for Tesla depends on FSD and autonomy, a key missing piece of that puzzle is Tesla making FSD available in China, which now appears just around the corner.”

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