Tesla Drivers Face More Restrictions At Chinese Government Venues Over Data Concerns - Tesla (NASDAQ:TSLA)

Data security concerns have reportedly led to a significant increase in restrictions placed on Tesla Inc TSLA vehicles entering government-related venues in China.

What Happened: An increasing number of government affiliates, local authorities, and cultural and exhibition centers have been prohibiting Tesla Inc. TSLA cars from entering their premises, Nikkei Asia reported. This heightened level of restriction has been progressively taking place since last year due to the deepening tension between Beijing and Washington.

Previously, the entry restrictions on Tesla vehicles were largely confined to military bases in China. However, the escalating concerns over data security have led to a broadening of this prohibition, affecting more locations associated with the Chinese government.

Tesla has been seeking to address these concerns. In August, the company said in a Weibo post that all data generated by its vehicles sold in the Chinese mainland market will be stored in China. Tesla established a research center and a separate data center in Shanghai in 2021 to locally store operation data following a directive from the government.

Why It Matters: The situation arises as Tesla faces increased competition in the Chinese EV market, particularly from Warren Buffett-backed BYD. In the last quarter, BYD trumped Tesla as the world's largest EV maker, selling more pure electric vehicles than Tesla.

Earlier this month, Tesla cut prices on its cheapest Model 3 by as much as 6% and its Model Y SUV by as much as 2.8% in China in a bid to make its vehicles more affordable and attractive to buyers.

Photo by Koshiro K on Shutterstock.

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