“There is a strong incentive for us to be very confidential with any information,” said the billionaire on Saturday at the China Development Forum, an annual conference organized by a unit of the government’s State Council. “If Tesla used cars to spy on China or anywhere, we would be closed.”
A few hours before he spoke, Reuters and Bloomberg reported that China’s military had banned Tesla vehicles from entering their complexes, expressing concern about the cameras equipped on board.
In addition, The Wall Street Journal reported on Friday that the government was restricting “military personnel and employees of major state companies” from driving the US automaker’s cars, “citing concerns that the data collected by the cars may be a source. of national security leaks. “
The points of sale mentioned anonymous sources. China’s Foreign Ministry and Tesla did not immediately respond to requests for comment from CNN Business on Monday.
In a video call on Saturday, Musk compared the controversy with the one that bothered TikTok last year, a company he said did not receive “confidence”. The ByteDance-owned app faced a potential ban in the United States last year for alleged national security reasons.
“The United States wanted to shut down TikTok. Fortunately, that didn’t happen,” said Musk. “A lot of people were concerned about TikTok. But I think that kind of concern is unnecessary and we should learn from it.”
High risk
Tesla has been a huge success in China in recent years, especially after building its Shanghai Gigafactory. In 2019, the company started making cars there to reinforce its presence in the largest automotive market in the world, with Musk even calling the factory a “model for future growth”. The company was able to maintain full control of the project, which was unusual at the time. And it has enjoyed strong government support in recent years.
But the American automaker has also attracted scrutiny from regulators recently, prompting some observers to wonder if its special relationship with the authorities is over. Last month, Tesla was summoned by Chinese officials to address questions about the quality of its cars made in Shanghai.
According to a report by The South China Morning Post on Saturday that quoted an anonymous source, the military ban was issued “a few weeks ago” because Chinese leaders were “very concerned” about the company’s vehicles. The newspaper added that Musk could visit China next month, citing the same source.
China is critical to Tesla’s global strategy and “remains the hub” that justifies a higher price for Tesla’s shares in the coming years, according to Dan Ives, managing director of stock research at Wedbush Securities.
That’s why, for the past few days, Wall Street has been “laser-focused on any Tesla stock [or] Musk in response to that poker move, “wrote Ives in a note to customers on Sunday.
“We believe that this statement … was important for Tesla and Musk to make directly to the Chinese and the government in Beijing, given the strategic importance of their [electric vehicle] ambitions within China, “he added.
“With a cold technology war brewing between the U.S. and China,” he said Tesla and others “remain caught in the crossfire and, ultimately, Musk needed to draw a clear line in the sand.”
– Shanshan Wang contributed to this report.
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