Tesla will store Chinese car data locally, following government fears of espionage

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Tesla says it has set up a data center in China to locally store and process the information produced by its vehicles. The announcement, made on Weibo, is because the US car maker is under pressure from the Chinese authorities for fear that its cars could be used for espionage.

“The security of car data is very important,” said Tesla (via Google Translate). “All data generated by vehicle sales in mainland China market will be stored in China.”

Reports of The Wall Street Journal and Bloomberg said Tesla’s cars have been banned from Chinese military sites, and that “military personnel and employees of major state-owned companies” are not allowed to own the vehicles. Chinese authorities were reportedly concerned that the exterior cameras on the cars could be used to collect sensitive data and return it to the US.

Elon Musk responded by saying that if this were true, it would be the end of the business in China. “There is a very strong incentive for us to be very confidential with all information,” Musk said in March. “If Tesla were to use cars to spy in China or anywhere, we will be shut down.”

Tesla must certainly keep China happy to ensure the company’s future growth. China is the world’s largest electric vehicle market – about three to four times the size of the US. Tesla sold 147,445 cars in China last year, according to Reuters, accounting for 30 percent of global sales.

Last month, the Chinese government published draft rules express his concerns about data collection by smart vehicles. The rules state that data about roads, buildings and terrain must not leave the country and that customers must give permission for the data to be collected. Tesla supported the rules through social media accounts in China.