Tesla reportedly is preparing to launch Full Self-Driving features in China in the new few days. But Tesla stock fell Monday, hitting fresh 2025 lows.
The update will let Tesla owners in China who have paid for FSD to use driver-assist features on city streets, Bloomberg reported, citing a source.
That could suggest Beijing has, or is about to grant, a license for Tesla FSD. Just last week, the Financial Times reported that China could delay FSD approval indefinitely amid the Trump tariff war.
There also has been speculation that, after getting a license, Tesla would need to do extensive testing on China roads before opening up the features to drivers. But that may not be the case.
Driver-assist tech is becoming more common. The world's largest EV maker, BYD, on Feb. 10 announced that it was rolling out "God's Eye" tech across its lineup, at no added charge, even to the Seagull EV that starts below $10,000. That could limit Tesla's ability to charge significant sums for FSD in China.
China state-owned automaker SAIC on Friday confirmed it'll be the latest automaker to team up with telecom gear giant Huawei, rolling out a cheap EV with the latter's driver-assist system. Huawei's driver-assist is generally viewed as best-in-class in China.
XPeng has said it wants to introduce Level 3 self-driving later this year. Level 3 self-driving lets drivers not pay close attention in certain conditions, such as the road, speed and time of day.
FSD, despite its name, is still a Level 2 driver-assist system.
Tesla Brand Issues 'Containable'
Wedbush Securities analyst Dan Ives conceded in a Monday research note that "Musk's DOGE related actions and more powerful alliance with Trump clearly could alienate some consumers to move away from the Tesla brand. There is some momentum around this effort in Europe and pockets of the U.S. as well since November."
But he views these as "containable brand issues" that don't change "the future of Tesla."
Ives points to new Model Y deliveries starting in the next few days, with a new mass-market vehicle launch by midyear that could be a "much needed growth catalyst." Ives cited the Optimus humanoid robot as another future catalyst.
And, of course, the planned Austin unsupervised FSD launch set for June is a huge factor for Tesla and TSLA stock.
The FSD Community Tracker, an unofficial tracker of Tesla FSD performance that Musk has endorsed multiple times, shows FSD still operating far below what could be considered self-driving.
Still, "the holy grail for Tesla and Musk is around autonomous and FSD looking ahead," Ives concludes.
Ives is sticking with an outperform rating and a $550 price target on Tesla stock.
Tesla Struggles As Rival Skyrockets On Self-Driving Push
Tesla Stock
Tesla stock fell 2.15% to 330.53 in Monday's stock market trading. Earlier, shares hit a new 2025 low of 324.70. TSLA stock is now down 32% from the Dec. 18 peak of 488.54.
Tesla fell 5.1% to 337.80 in last week's market sell-off, extending its losing streak to five straight weeks.
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