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The Critical. Crossroads The Shape SpaceX,
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I'm your host, Will. Walden Tesla is preparing to
register its Full Self Driving software with Chinese
authorities aiming to launch the advanced feature this year, And
it's according to three sources familiar with this matter now.
The move is part of Tesla's broadest strategy to expand its
presence in China, its second largest market.
And additionally, the company is considering offering the FSD
software as a monthly subscription to his Chinese
customers. Now securing registration with
China's Ministry of Industry and Information Technology, the MIIT
will allow Tesla to conduct internal testing of the FSD
system using its employees on public roads in China.
This testing phase is a precursor to making the software
available to Chinese users as an upgrade in the coming months.
And currently, Tesla offers 2 less advanced versions of its
Autopilot driver assist system in China.
The FSD system, which Tesla currently sells for a one time
fee of ¥64,000 that's approximately $8800 US, might
also be available as a monthly subscription fee, likely around
the $100 mark. About $98 apparently.
Now the introduction of a subscription model could attract
more customers by lowering the upfront cost area.
Now, Tesla's expansion plans include the potential licensing
of its FSD software to other automakers in China, and the
strategy could diversify Tesla's revenue streams amiss a
competitive and discount driven market.
Notably, Tesla sales in China have declined by 7.6% in the
first four months of this year due to increased competition
from local EV manufacturers. Yel Zhang, managing director of
Shanghai based consultancy Automotive Foresight, said that
Tesla's introduction of FSD in China would compel other EV
startups to expedite the research and development
efforts. The competitive pressure shows
the significance of Tesla's technology and the competition
between all these automakers and the roll out of FSD in China
aligns with a strategic shift by Tesla CEO Elon Musk to power the
development of its self driving system using data collected and
processed within China. Now this approach not only
leverages local data but also adheres to regulatory
requirements regarding data localization.
Now, Tesla aims to introduce version 12 of the FSD software
in China, and Musk has expressed confidence that this version
paves the way for fully autonomous driving systems.
The software's evolution reflects Tesla's ongoing
commitment to refining its self driving tech, and Tesla will now
join a competitive field in China, where at least 10
automakers and suppliers, including Huawei and Zping, are
developing Level 2 autonomous driving capabilities.
And unlike Tesla, some competitors like Lee Auto and
Zping offer similar systems for free on high end models, while
others, such as Neo provide trial periods at no cost.
The Level 2 systems, including Tesla's FSD, still require
active driver supervision and hands on control.
However, Elon Musk has indicated that more fully autonomous
vehicles are on the horizon. Tesla plans to reveal additional
details about its robo taxi program in August, which could
provide insights into his future autonomous vehicle strategy.
A Tesla's autonomous driving system is built on an end to end
neural network, a distinct departure from rule based
algorithms. The AI enables the system to
learn faster and make more human like decisions, a capability
that sets Tesla apart from its competitors.
Other companies like Huawei are following Tesla's lead by
developing end to end AI models for autonomous driving.
Despite this, catching up with Tesla in terms of data and
computing power remains a significant challenge for
rivals. Now this is going to be a
competitive market in the next year and these other companies
will hop on the bandwagon and get more processing compute.
Tesla's advantage lies in a supercomputer, Dojo, which
trains the FSD system using video data from millions of
Tesla vehicles. This connected network, the
largest fleet of its kind globally, provides Tesla with an
unparalleled data advantage, essentially for advancing its
self driving capabilities. And in parallel with the FSD
rollout, Tesla has partnered with Baidu for in vehicle
mapping and navigation services. This collaboration addresses one
of the critical requirements for launching advanced self driving
features in China, ensuring accurate lane level navigation
and mapping. Now, Tesla initially engaged
Baidu for mapping services way back in 2020, but the
partnership has now intensified to support more advanced
autonomous driving functionalities.
The development follows Musk's recent visit to China, where he
sought approval for the FSD software to counter declining
revenues. The suite of FSD features, while
requiring constant oversight, aims to enhance Tesla's
autonomous driving offerings. The company's pricing strategy
for FSD in China mirrors its approach in US, where customers
can either purchase the software outright or subscribe monthly.
Tesla also offers Enhanced Autopilot EAP in China and half
the price of FSD has introduced subscription options for EAP,
allowing customers to experience the technology for a monthly
fee. This flexibility and pricing and
access models could boost adoption rates among China
consumers, and recent developments such as Tesla
Shanghai factory passing data security requirements have
facilitated the broader acceptance of Tesla vehicles and
restricted areas within China. This compliance with national
standards enhances the credibility and marketability of
Tesla's products. Now, the FSD software rollout in
China is anticipated to generate significant interest and
discussion and revenue. Given the competitive nature of
the Chinese EV market and the technological advancements it
represents. The company's strategic moves
and partnerships aims to solidify its position as a
leader in autonomous driving technology in China and
worldwide. Hey, thank you so much for
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