Tough Times for Tesla Inc (NASDAQ: TSLA) After China Suspects Intelligent Cars’ Spying

Tesla Inc (NASDAQ: TSLA) gets cornered yet again in China over spying suspicion. China wants to review its car data regulations to maintain collected data in the country purposefully. Rumors indicate that Tesla is becoming malicious in using the cameras in its vehicles to collect data for spying. 

China’s moves

China considered the draft regulation and sent it to its portal. The government has called out to its citizens to comment on the issue until May 15. It will partly rely on public opinion in making its final move.

The draft proposes that all information collected stays within the confines of the country. The cars’ external cameras collect crucial information ranging from location data, images of roads and buildings.

Tesla reacted after it learned that China had banned its cars from the military bases and housing compounds. China placed the ban and started investigating the matter. The company’s CEO, Elon Musk, was the first one to speak. He defended the company saying that Tesla couldn’t be involved in such malicious activities because it could be risking termination. An official statement from Tesla came out later, indicating that the cameras hadn’t been activated outside North America.

Tesla continues to witness closer scrutiny in the country

It was a big win for Tesla when China allowed it to stage its business in the country. Tesla admits that China is one of its largest markets. However, the company continues facing many challenges in the country. 

It was during the Shangai Auto show that matters escalated, risking the company’s business in China. One of the company’s customers jumped on top of one of Tesla’s cars, protesting about failed breaks. Tesla denied the woman’s claims, casting blame on the customer. It cited that the customer had encountered several accidents with the car, and that is how the brake system failed. The company also claimed that the customer was only out to get a new car as compensation because she had denied Tesla’s proposal to get the car inspected by a third party. 

The market regulators swing into action to investigate Tesla. The online criticism of Tesla’s service delivery was also a major setback for the company. 

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