Elon Musk seeks approval to transfer data from China for training autonomous driving algorithms.
Elon Musk, Tesla CEO, arrives in China on Sunday, a week after postponing his India trip due to Tesla-related commitments.
Reuters reports that Musk, amid declining Tesla production and inventor queries, will discuss Tesla’s Full Self-Driving software rollout and data transfer permissions with Chinese officials.
Tesla’s Strategic Moves in China and India
Musk seeks approval to transfer China-collected data for autonomous driving algorithms. Since 2021, the company has stored all Chinese fleet data in Shanghai per regulatory requirements.
New Delhi recently introduced an electric vehicle (EV) policy, primarily to welcome Tesla, whereas Tesla operates its largest global plant in Shanghai, manufacturing over 1 million Model 3 and Model Y cars annually.
Chinese state media stated that during a meeting in Beijing on Sunday, Musk met with Chinese Premier Li Qiang, who acknowledged Tesla’s development in China as a successful instance of US-China economic and trade cooperation.
Since entering the market a decade ago, Tesla has sold over 1.7 million cars in China. Additionally, China serves as a critical hub for Tesla, supplying cars to New Zealand, Australia, and Europe.
Tesla’s Global Expansion Strategy: Insights from Musk’s Visits to China and India
Reuters stated that Musk’s visit coincides with the Beijing auto show, ongoing since last week and concluding on May 4. Musk’s Sunday afternoon schedule also included a meeting with Ren Hongbin, a government official overseeing the China Council for the Promotion of International Trade, which organizes the Beijing auto show, according to Chinese state media.
Before Musk’s India visit, policymakers began consultations to release EV policy guidelines. Shortly after Musk postponed his visit on April 20, Finance Minister Nirmala Sitharaman stated India is formulating policies to attract major companies for investment, particularly amid industry apprehensions regarding China.
In a bid to attract investments in the EV sector, the Centre has reduced import duties to 15% from 100% for electric car models priced at $35,000 or more, including CIF costs, for five years. This condition is crucial for Tesla’s entry to assess the “market potential” in India.
India’s Strategy on Chinese Investments and Oil Dependency
The Centre reportedly declined a proposal from China-based BYD and Hyderabad-based Megha Engineering and Infrastructures Ltd to establish a $1-billion EV plant in June last year. This rejection aligns with India’s strategy to regulate Chinese investments in vital sectors.
India’s policy emphasizes fostering a vibrant EV ecosystem to reduce heavy reliance on imported crude oil. Official data shows that India’s oil import dependency rose to 87.7% in FY24 from 87.4% in FY23. Mitigating expensive oil imports remains a priority for the government, highlighted in the BJP’s 2024 Lok Sabha election manifesto.
A comparable approach was observed in mobile manufacturing, with Apple and other global mobile phone makers being incentivized under the Production Linked Incentive Scheme to commence phone production in India, fostering a more extensive manufacturing footprint in the nation.
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