Tesla Inc. has stated that it will introduce its Full Self-Driving (FSD) technology in China and Europe within the first quarter of 2025, subject to regulatory permissions.
TakeAway Points:
- Tesla intends to introduce Full Self-Driving (FSD) in China and Europe in Q1 2025, subject to regulatory clearances.
- In China, Tesla has made strides, passing evaluations for data security and landing a mapping contract with Baidu.
- Tesla wants to increase sales despite the setbacks and maintain an advantage over Chinese competitors who are creating comparable driver assistance technologies.
Tesla’s FSD Plans
This announcement was made through the official X account of Tesla AI, an affiliate of the electric vehicle maker. The company aims to gain permission from authorities in these regions to boost sales and stay ahead of Chinese rivals who are also developing similar driver assistance systems.
Tesla has made significant progress in gaining approval for the China market. The company passed data security assessments and reached a mapping and navigation deal with tech giant Baidu Inc. Additionally, Tesla received approval to test its FSD technology on Shanghai streets, as reported by Bloomberg in June. Despite these advancements, the technology has faced increased scrutiny in the US, where drivers are still required to keep their hands on the steering wheel and pay attention to the road while using the software.
Challenges in Regulation and the Market
Elon Musk, Tesla’s CEO, mentioned in a July earnings call that he expected the FSD driver system to be approved in Europe, China, and other countries by the end of the year. He also indicated on X in April that the roll-out in China “may be possible very soon.” However, the launch has been slightly delayed from previous plans. Local media outlet SH Observer reported in June that Shanghai’s Nanhui New Town was pushing for 10 Tesla vehicles to carry out a pilot of FSD.
Despite these efforts, Tesla’s progress in rolling out FSD in China has been slower than expected. According to an August 29 report by LatePost, Tesla had originally planned to start a small internal test of FSD in China this September, but the test has now been delayed. In China, all Tesla vehicles come with free Basic Autopilot (BAP) driver-assist software. Although FSD is not yet available in China, Tesla allows car owners to purchase it for a one-time fee of RMB 64,000 yuan ($9,020). Enhanced Autopilot (EAP) is also offered at half the price of FSD.
Competitive Environment
For local Chinese EV makers, the introduction of Tesla’s FSD technology presents both a challenge and an opportunity. They are concerned about the pressure FSD will put on them but also expect it to invigorate the industry. Tesla will face significant challenges in making FSD work in China, including dealing with more than 300 million electric scooters that often ride on motorised lanes. Xpeng’s head of autonomous driving, Li Liyun, highlighted this issue in late June, stating that one of the headaches Tesla’s FSD will face is navigating non-motorized vehicles, including electric scooters.
Tesla’s China shipments in the first eight months of this year have fallen about 6% compared to last year, according to data from the China Passenger Car Association. The company hopes that the approval and launch of FSD will help it stay ahead in China, its largest overseas market, where dozens of brands are eroding Tesla’s market share and developing their own advanced driver assistance technology.
