Tesla's Stock Soars 5% on Expectations for Full Self-Driving Launch in China

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The stock price of Tesla, the largest electric vehicle company in the United States, surged more than 5% following news that it received approval to test Full Self-Driving (FSD) in Shanghai, China.

According to Bloomberg on the 17th (local time), Tesla received approval from authorities to test the FSD system on roads in Shanghai that day. The report, citing sources, also stated that Hangzhou City in China may approve Tesla's FSD testing as well.

Tesla has so far offered Autopilot, a lower-level driver assistance system than FSD, in China, and the FSD sold in the U.S. had not been launched in China due to data regulations imposed by Chinese authorities. However, the possibility of launching FSD in China emerged after Tesla CEO Elon Musk visited Beijing in April and reportedly discussed this issue with Li Qiang, Premier of the State Council of China.

On the 10th, news also emerged that Tesla would receive upgraded map software from Baidu. According to Chinese regulations, all autonomous driving-related systems must obtain map-making qualifications before operating on public roads, and foreign companies must partner with authorized Chinese companies.

Through the launch of FSD, Tesla is expected to gain an opportunity to expand sales in the recently sluggish Chinese market, while making progress in FSD development toward full autonomous driving technology using the vast driving data collected in China.

On the same day, Tesla's stock price on the New York Stock Exchange rose about 5.3% from the previous trading day to $187.44. This is the highest level in about four weeks since April 21 (closing price $186.60). The market capitalization increased to approximately $597.8 billion. The year-to-date stock price decline has narrowed to 24%.