Tesla Faces Bans in China?! Here’s the Latest Update…

China was wary of Tesla
Even banned driving in some areas
Surprising news reported

As of January 2024, China’s view of Tesla electric vehicles was cold. This is because the ban on Tesla, limited to the People’s Army and government officials, has now been widely implemented in government-related facilities used by citizens. The Grand Halls banquet hall on the Bund, a tourist attraction in Shanghai, China, refused entry to customers visiting in Tesla vehicles.

In certain areas, Tesla vehicles have faced road restrictions. During the 2023 Summer World University Games in Chengdu, Sichuan Province, Tesla vehicles were prohibited from driving on specific roads. By the end of 2023, Tesla vehicles were banned from certain central downtown areas in Chongqing, one of China’s four major municipalities.

Suddenly Changing Stance, China Embraces Tesla

However, Chinese public companies have recently purchased Tesla’s electric vehicles as official vehicles. According to Chinese media sources, on July 7, several public enterprises in China, including Shanghai Chengtou and Lingang Special Area Investment Holding Group, purchased Tesla’s Model Y as an official vehicle.

The Investment Promotion Service Center of Shanghai’s Lingang New Area said that this was an example of a state-owned enterprise in the district actively fulfilling the demand for equal treatment of Chinese and foreign companies in procurement activities. Lingang New Area is also where Tesla’s 860,000 m2 (9,256,962 ft2) Gigafactory factory is located. It was also analyzed that more than 95% of Tesla factory parts are made in China, which also played a role.

The Reason Behind the Change: Investment Moves

The media analyzed this movement as related to the recent trend of fair treatment of foreign-funded companies across China. At the Foreign Investment Forum held in Beijing on July 1, with the participation of political officials, an agreement was reached that Chinese and foreign companies should be equally supported in participating in Chinese government procurement. The key is to help overseas investment companies without discrimination regarding large-scale equipment updates, government procurement, and bidding participation.

At the Executive Meeting of China’s State Council on June 26, 2024, there was a strong emphasis on implementing measures to increase the absorption of foreign capital, highlighting the significant role foreign-invested companies play in China’s new development strategy. On July 4, the government of Jiangsu Province, located near Shanghai, released its 2024-2025 eco-friendly vehicle procurement list. Tesla’s electric vehicles were included for the first time, with the Model Y featured alongside 56 other models. Among these was Volvo’s XC 40 Recharge Long Range model, sold under China’s Geely brand.

A vehicle made in China because the parts are domestically produced?

For the first time, party, government, and public institutions in Jiangsu Province are authorized to purchase and use Tesla’s electric vehicles as official vehicles. A Jiangsu Government Procurement Center official clarified, “In government procurement, imported goods are typically not purchased and must undergo special screening. However, since they are domestically produced, Tesla vehicles are not considered imported.” The Teslas are assembled at the Gigafactory in China, where 95% of the parts are manufactured locally. This distinction includes Tesla vehicles in the government’s eco-friendly vehicle procurement list.