The boss of the electric car brand Tesla, Elon Musk, arrived in China on Sunday April 28, official television CCTV announced. This is his second visit in less than a year to this country which represents the largest market for electric vehicles. Fully electric vehicles and plug-in hybrids are expected to account for 40% of new vehicle sales there, according to the China Passenger Car Association.
According to Chinese television, the billionaire was invited by the China Council for the Promotion of International Trade “to discuss next steps in terms of cooperation and other issues.”
“China’s huge market will always be open to foreign-invested enterprises,” Chinese Premier Li Qiang told him. according to the CCTV channel, promising that China “will continue to work hard to expand market access.” This meeting comes during the Beijing auto show, which Tesla has not participated in since 2021.
Why is China interested in Musk?
China presents many business interests for Elon Musk. Tesla has sold more than 1.7 million cars in China, its second-largest global market after the United States, since entering the market a decade ago, and the Shanghai plant is its largest factory in the world.
According to the Reuters news agency, Musk must meet during his trip with senior officials to discuss the deployment of self-driving software (FSD) as well as “authorization to transfer data abroad”. Launched four years ago, the Full Self-Driving (FSD) system, the most autonomous version of Tesla’s self-driving software, has not yet been made available in China. In a response to a user on the social network X on April 20, Elon Musk announced that the system could arrive “very soon” on Chinese territory.
According to information obtained by Reuters, the Tesla boss is also seeking authorization to transfer data collected by its fleet in China abroad, in order to train algorithms for its autonomous driving technologies. Since 2021, Tesla has stored all this data in Shanghai, as required by Chinese regulators.
Tesla is struggling
While China offers opportunities to Tesla, competition is tough in the electric vehicle market: at the end of 2023, the Chinese manufacturer BYD for the first time overtook Tesla in the number of electric cars delivered worldwide. Tesla regained its global title in the first quarter of 2024, but BYD leads in the Chinese market.
With deliveries of electric cars falling sharply overall at the start of 2024, the Tesla company, which had not reached such low figures since the third quarter of 2022, also announced in mid-April that it was removing “more than 10%” of its workforce across the world. At the end of December, the manufacturer also had to recall two million vehicles in the United States for a risk linked to their assisted driving system, and 1.6 million vehicles in China.
Elon Musk’s interest in China raises questions from Washington. US President Joe Biden notably declared in November 2022 that the billionaire’s links with foreign countries “deserved” to be examined.