Musk advocates for utilizing Chinese data to fuel Tesla’s AI aspirations.

Tesla is forging ahead with plans to advance its global self-driving technology using data sourced from China, a strategic shift spearheaded by Elon Musk, according to individuals familiar with the matter.
As part of this initiative, Tesla is reportedly strategizing the establishment of a data center in China to train the algorithms necessary for achieving fully autonomous driving capabilities. These plans are being developed discreetly, as confirmed by two sources who preferred to remain anonymous.
Previously, Tesla’s focus had been on obtaining approval from Chinese regulators to transfer data generated by its electric vehicles (EVs) out of China for its “Full Self Driving” (FSD) system. It remains uncertain whether Tesla will pursue both options—data transfer and a local data center—or if it is formulating contingency plans.
Tesla’s emphasis on leveraging vehicle data from China to enhance its AI driving capabilities underscores the company’s swift pivot towards banking on AI breakthroughs, especially amidst a slowdown in EV demand and heightened competition.
This push aligns with the broader context of the U.S. government’s efforts to restrict the transfer of AI technology from U.S. companies to China.
Currently, Tesla has been unable to offer the complete version of FSD, priced at nearly $9,000 equivalent, in China.
A broader adoption of FSD in the Chinese market could potentially bolster Tesla’s revenue and profits, particularly as it faces increasing pressure from domestic competitors like BYD.