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Tesla Facing "Further Fallout" In China As Local Governments Mull "Security Risks" Of Vehicles

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by Tyler Durden
Sunday, May 30, 2021 - 02:30 PM

The rocky road between Tesla and the Chinese Communist Party looks like it is continuing.

The automaker is facing "further fallout" in China as some local governments are reviewing Tesla vehicle ownership among their staff, citing the vehicles posing potential security risks, according to Bloomberg

Government bodies have been asked to check and report on employees who own Teslas in Zhejiang and Guangxi. Employees are being "forbidden" from driving into certain official areas, due to supposed security risks, the report notes. 

Other official Chinese bodies are following suit. The China Meteorological Administration, for example, has already told its employees not to buy Tesla EVs and, if they have already, to transfer ownership of the vehicles. The Propaganda Department of the Chinese Communist Party (yes, this is actually what it is called) is also "checking whether any employees or their family own Teslas."

Any continued major hiccups in Tesla's relationship with China could be devastating for the automaker, who relies on the world's largest auto market to help it redline production to meet Wall Street's increasingly optimistic expectations. 

Recall, we noted in mid May that Teslas had been banned from some Chinese government compounds due to concerns about their cameras. 

"China rocks."

Staff at some Chinese government officers were told not to park their Tesla cars inside of government compounds "because of security concerns over cameras installed on the vehicles," Reuters reported in May.

"At least two government agencies" in Beijing and Shanghai have been told the same, according to the same report. It's unclear how many employees and vehicles this had a direct impact on. 

Despite the fact that cameras and sensors are found in many vehicles, the restriction "only applies to Tesla cars", the report noted. 

This isn't the first time China has cited security concerns as a reason to ban Tesla vehicles. Back in March, China banned Tesla vehicles from military bases over similar concerns about the vehicles' cameras. The ban was due to "concerns about sensitive data being collected by cameras built into the vehicles."

Recall, before making somewhat of an about face on their recent attitude on Tesla (after Musk's odd rebuke of bitcoin), Chinese state media had been anything but friendly to the U.S. auto manufacturer. 

We have been documenting the ongoing spat between Tesla and the CCP over the last few months, apparently (at least publicly) catalyzed by a protestor at the Shanghai Auto Show alleging faulty breaks on Tesla vehicles. This led to intense shaming by Chinese media, who called Tesla's handling of the situation a "blunder" and suggested it could "inflict serious damage" on Tesla with the Chinese market. 

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