Tesla’s (TSLA) Elon Musk went globetrotting to China and scored a big victory for Tesla’s Full Self Drive (FSD) Technology. Or did he?
Who Needs Whom More?China handed Elon Musk a victory, but that was primarily for political propaganda. Here’s the real setup: Musk Now Needs China More Than It Needs Him
Tesla’s chief executive left the country with assurances that the carmaker will be able to roll out its driver-assistance technology. The software underpins Musk’s hopes for rekindling Tesla’s growth in the world’s biggest electric-vehicle market, where it is being outmaneuvered by homegrown rivals.
China, meanwhile, used his trip to promote its message that it is open to American businesses, despite rising tensions with the U.S. State media quoted Musk giving a stamp of approval to China’s EV market, saying his comments dispelled U.S. concerns about overcapacity. Beijing also sought to show that foreign firms can thrive under its tight regulatory controls over data.
When talking about plans for Tesla’s “Full Self-Driving,” or FSD, features during a call to discuss the company’s dismal earnings last week, Musk said Tesla would release the service “in any market that—where we can get regulatory approval for that, which we think includes China.”
Days later, he flew to Beijing to seek Chinese leaders’ blessing. During his less-than-24-hour visit, Chinese regulators also gave Tesla’s cars clearance for data that they collect on the road, potentially paving the way for the government to loosen bans on the vehicles going to sensitive sites such as military complexes and some government buildings.
Musk also agreed to a deal with China’s Baidu for its FSD rollout, reassuring Chinese leaders over the security risks of Chinese user data.
Chinese state television showed the meeting between Li and Musk. Li, previously the Communist Party chief in Shanghai when Tesla was setting up its production facilities there, called Musk his “old friend” and Musk’s 3-year-old son “a handsome little boy” during their meeting.
“China’s huge market is always open to foreign businesses. China does what it promises,” Li said, according to a government readout of the meeting. China is committed to offering a better business environment allowing foreign corporations to feel safe about investing in China, he added.
Musk has often been a dependable ally to Beijing. He has publicly praised its ruling Communist Party and China’s economic miracle. Musk was rebuked by the government of Taiwan after he described the self-ruled island as China’s equivalent of Hawaii, with Taiwan’s Foreign Ministry suggesting the Tesla CEO had sold himself to Beijing.
Sappy MeetingThis whole thing is dripping with sap. If China needs anything from FSD it will take it.What China does need is a way to show that it is open for business hoping to stave off US tariffs. China is also looking for any political victories while crossing Biden’s red lines on arms sales to Russia. See China Crossed Biden’s Red Line on Ukraine, So What?Whatever this little pat-a-cake is all about, it is not going to stave of major trade wars shortly after the November election no matter who wins.More By This Author:Wages And Benefits Rise More Than Expected, Bond Yields Jump New Biden Energy Rules Will Raise The Cost Of A New Home By $31,000 The G-20 Proposes A 2% Wealth Tax On Assets, Will Biden Approve?
