Elon Musk’s flying visit to China seems to have had a major payoff for his spluttering electric vehicle maker. Investors certainly thought so, with Tesla’s shares soaring.in the fierce, price-driven competition with China’s multitude of domestic EV and hybrid vehicle manufacturers.
Assuming the tentative security clearance is confirmed, Tesla would be able to roll out its FSD system in China, making its vehicles far more competitive against the leading edge of Chinese EV technology. It would also offer a new stream of income, from purchases of the FSD software and subscriptions for it, to offset the impact of the brutal price war within China’s domestic EV market.
With China regarding data protection as a national security issue that is a big ask, but one that could, with the $US10 billion a year Musk has said Tesla will spend on AI, give the company a competitive advantage. Tesla shares soared more than 15 per cent on the news. Since it’s pre-results low, Tesla’s market capitalisation has jumped $US166.4 billion, to nearly $US619 billion, recovering more than $US37 billion of Musk’s own net worth in the process.