Tesla, Inc. is facing a tough time in the electric vehicle (EV) market, particularly in China. The company’s stock has been plunging, extending its three-day losing streak. To make matters worse, an analyst has reiterated a Sell rating on the stock due to the rollout of Full Self-Driving (FSD) features in China.
FSD Features in China
The limited FSD features being rolled out in China are similar to those included in the company’s full self-driving software in the US. These features include:
- Identifying traffic lights
- Allowing for automatic lane changes
- Other advanced driving capabilities
Challenges in the Chinese Market
According to Guggenheim analyst Ronald Jewsikow, Tesla is competing against its Chinese rivals “with one hand tied behind its back.” The company is at a disadvantage due to restrictions on using proprietary vehicle data for training FSD in China. Instead, Tesla is relying on open-source images and videos, which may not be as effective.
Pricing Concerns
Jewsikow is also skeptical of Tesla’s ability to price FSD in China, where the service is priced at 64,000 yuan (approximately $8,830) above the purchase price of the vehicle. With over two million Tesla vehicles in the country, it remains to be seen how many owners will pay for the service.
Stock Performance
Tesla’s stock has taken a hit, down 8.26% at $303.55 at the time of publication. The company’s struggles in the Chinese market are likely to continue, making it an uphill battle for Tesla to keep up with its rivals.
Key Takeaways
- Tesla is facing challenges in the Chinese EV market
- The company is at a disadvantage due to restrictions on using proprietary vehicle data for FSD training
- Pricing concerns remain for FSD in China
- Tesla’s stock has taken a hit, down 8.26% at the time of publication
What’s Next for Tesla?
As the company continues to navigate the competitive EV market in China, it remains to be seen how Tesla will address its challenges and keep up with its rivals. Will the company be able to overcome its disadvantages and succeed in the Chinese market? Only time will tell.