Days after he cancelled his India visit at the last moment, Tesla chief executive Elon Musk flew to the Chinese capital city of Beijing for a surprise meeting with its premier Li Qiang. The US-based mega billionaire’s visit to China came after a big development around Tesla's China unit, which fulfilled a requirement for data security norms concerning Tesla's locally-made vehicles.
"Honored to meet with Premier Li Qiang. We have known each other now for many years, since early Shanghai days," Musk said via X.
Tesla is among several other auto companies, including BYD, Lotus, Li Auto, Nio, and Nezha, to pass China's latest requirements around data security. This could mean a sales boost and other benefits for Tesla as some Chinese authorities had banned Tesla EVs on their premises, primarily due to security reasons.
A Chinese industrial association, the China Association of Automobile Manufacturers and the National Computer Network Emergency Response Technical Team/Coordination Centre released a list of 76 models that cleared the country's data security requirements.
Musk’s visit to Beijing reportedly also clears a key obstacle in his plans to boost efforts towards assisted driving features in the country. Post the clearance, media reports suggest Tesla will be able to enable the Full Self Driving (FSD) feature in China. Tesla's FSD feature is available in the US and a few other countries.
China's capital city is also hosting a major auto show starting April 28, though Tesla is not participating in the auto show this time.
Tesla CEO Elon Musk, who was planning to meet Prime Minister Narendra Modi in India this month, postponed his visit at the last minute on April 20, 2024, due to "very heavy Tesla obligations". "Unfortunately, very heavy Tesla obligations require that the visit to India be delayed, but I do very much look forward to visiting later this year," Musk said.
Musk's planned India visit was to announce investment plans for the country. Tesla is currently scouting locations to set up a plant, with Maharashtra and Gujarat being the frontrunners.
In the first quarter of 2024, Tesla produced over 433,000 vehicles and delivered around 387,000 vehicles, recording a 2% growth. In the first quarter earnings, Tesla reported 9% year-on-year drop in revenue to $21.3 billion due to reduced average selling price of vehicles, the Model 3 update in the Fremont, California factory and disruptions at the Berlin gigafactory. The company's net income dropped 55% to $1.13 billion from $2.51 billion a year ago.
Notbaly, the India government had recently unveiled a new EV import policy that slashes import duty to 15% from 100% for EVs costing $35,000. Under the new policy, automakers are required to make a minimum investment of ₹4,150 crore or $500 million. The government has given a three-year timeline to automakers for setting up new manufacturing facilities in India and starting commercial production of EVs, and reaching 50% domestic value addition (DVA) within 5 years at the maximum. A localisation of 25% is to be achieved by the third year and 50% by the fifth year.
