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Tesla to work with Baidu in push to offer self-driving tech in China

Written by Nikkei Asia Published on   3 mins read

The US carmaker has cleared regulatory obstacles, but the timetable remains unclear.

Tesla is moving closer to introducing its self-driving system in China, the US automaker’s biggest overseas market, following founder Elon Musk’s surprise visit to the country.

The electric vehicle maker “recently” struck a deal with Chinese tech giant Baidu to use the latter’s mapping and navigation functions, a source familiar with the agreement confirmed to Nikkei Asia. Multiple other media outlets, similarly citing anonymous sources, also reported the arrangement.

Separately, Musk flew in on April 28 to meet with Premier Li Qiang. Chinese media did not reveal details of the meeting, but authorities announced the same day that, in a voluntary test, Tesla was the sole foreign brand that met the country’s automobile data security standards. These entail anonymizing facial data captured outside the vehicle, not collecting cockpit data by default, processing cockpit data within the vehicle, and providing notifications for handling personal information.

The two moves are regarded as clearing hurdles to Tesla’s rollout of what it calls Full Self-Driving (FSD) in China. This would make Tesla more competitive in the Chinese market, where it faces growing challenges from local players such as BYD.

In the first quarter, Tesla’s market share in China was 7.5%, a decline from 10.5% in the same period of last year, according to the China Passenger Car Association.

While FSD is already available in some countries including the US—enabling features such as self-parking, auto lane changes, and traffic navigation—Tesla needs to meet certain compliance requirements to do so in China.

The authorities insist that intelligent driving systems must be equipped with what is known as an “A-level” mapping qualification, and foreign players need to partner with Chinese companies to use that service. Baidu is among 19 Chinese companies that currently hold such credentials.

Neither Baidu nor Tesla immediately responded to Nikkei Asia’s request for comment.

Tesla’s FSD system relies heavily on high-definition maps, and having the latest data is crucial given frequent road construction in China. “It’s a very labor- and technology-intensive industry and it is quite costly to maintain the up-to-date maps,” said one executive from an autonomous driving company, who declined to be named.

Passing the data security testing, meanwhile, means Tesla’s China-made Model 3 and Model Y may be allowed in some restricted areas at airports, government campuses, and highways. Some Chinese airports previously banned Tesla from their parking lots due to its Sentry Mode, which could continuously record the surrounding environment when the vehicle owner is absent. This raised concerns among Chinese officials about potential data leakage.

Despite the apparent progress, the timeline for activating FSD in China remains unclear, and the remaining requirements are uncertain.

When asked on April 29 if China will allow Tesla’s FSD to operate in China after Musk’s visit, Ministry of Foreign Affairs spokesperson Lin Jian replied only that “China attaches great importance to the concerns of foreign enterprises,” and that “China also expects foreign companies to comply with Chinese laws and regulations and fulfill their safety commitments.”

The Wall Street Journal reported on April 29 that Beijing had tentatively approved Tesla’s plan to launch its FSD in China, citing anonymous sources. But the state media outlet Beijing News reported the same day that Tesla told them “there is no timetable for the rollout of FSD in China.”

Tesla has previously taken steps toward launching FSD in the country. The company built a new data storage center in Shanghai in 2021 to store information generated by its vehicles sold in China, as Beijing tightened rules preventing overseas transfers of sensitive data.

This article first appeared on Nikkei Asia. It has been republished here as part of 36Kr’s ongoing partnership with Nikkei.


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