Tesla CEO Elon Musk has lauded Chinese automakers calling them the “most competitive in the world,” during a question-and-answer stream at the World New Energy Vehicle Congress, which is hosted in China’s Hainan province.
Elon Musk was highly complimentary of the nation that’s imperative to his electric vehicle company, and the comments come as Tesla tries to improve its reputation in China. He said:
“I have a great deal of respect for the many Chinese automakers for driving these (EV) technologies. These (Chinese) carmakers are some of the best at software, which will “shape the future of the automobile industry.”
Tesla’s competitors in China include electric car makers such as Nio, Xpeng among many others. Tesla began producing cars in its Shanghai factory in 2019, and within two years its sales in China are now nearly half the size of what the automaker sells in the United States. Tesla reported sales of $3.11 billion in China in the third quarter of 2021, or 48.5% of the $6.41 billion U.S. sales during that time.
Now however, Tesla is facing a backlash over its electric car business in China. Recently a Chinese court ordered Tesla to refund the purchase price of Model S to the customer plus three times the amount in the form of compensation – making a total of 1.5 million yuan, because Tesla has allegedly sold substandard used-car to its customer.
In March, China’s ministry of industry and information technology, demanded Tesla to ensure product consistency, quality and safety. But the Chinese customers complained that they were getting inferior cars from Tesla while some buyers pointed out that the control units in their cars run on HW2.5 chips, which are less advanced than the HW3.0 chips listed on the spec sheet.
Another high-profile case occurred in April earlier this year when a woman, who claimed to be a Tesla customer, protested an alleged brake failure in her car at the Shanghai auto show. A video of the incident went viral on Chinese social networks, and state media said Tesla had an “arrogant and overbearing stance” in China.
A female Tesla owner climbed on top of a car’s roof at the Tesla booth to protest her car’s brake malfunction at the Shanghai auto show Monday. The booth beefed up its security after the incident. pic.twitter.com/ct7RmF1agM
— Global Times (@globaltimesnews) April 19, 2021
Earlier this year, China’s military also banned Teslas from military barracks and family quarters, citing security concerns over the onboard cameras, according to the Wall Street Journal. There are 8 cameras in a Model 3– three in front, two on each side and one at the rear, which are used for the autopilot, the security system and the dashcam. The cameras can obtain data, including when, how and where the vehicles are being used as well as the contact lists of mobile phones synced to them. Beijing was concerned that some sensitive data could be sent back to the U.S.
On March 20, Elon Musk assured members of the government-backed China Development Forum in Beijing that the cars were not spying and that the data collected from cars in China was kept in China. However according to analysts, by making use of anti-American public sentiment, the ruling Chinese Communist Party (CCP) is making a move against Tesla that is well-known to foreign companies with technologies it covets: To stay in China’s lucrative market, a company must share its tech with Beijing.
According to JL Warren Capital, an equity research firm that focuses on Chinese and U.S. companies with significant exposure in China, “Tesla is fully aware of the severity of the PR crisis” it faces in China. Tesla also reached out to social media influencers in China to try to get them to remove or recant their critical posts, including some by noted automotive experts.
A computer animation professional with over 23 years of industry experience having served in leading organizations, TV channels & production facilities in Pakistan. An avid car enthusiast and petrolhead with an affection to deliver quality content to help shape opinions. Formerly written for PakWheels as well as major publications including Dawn. Founder of CarSpiritPK.com