Tesla Prepares to Deploy Long-Awaited FSD Features in China

(Bloomberg) — Tesla Inc. is readying a software update for customers in China to offer driver-assistance capabilities similar to those marketed as Full Self-Driving in the US, according to a person familiar with the matter.

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The update planned for the coming days will allow Tesla owners to use driver-assist features on city streets, said the person, who asked not to be identified because the company hasn’t yet deployed the software. Tesla plans to tell customers the system will guide vehicles to exit ramps and intersections, and that it can recognize traffic signals, make turns and handle changing lanes and speeds.

The capabilities will be deployed to customers who’ve paid 64,000 yuan ($8,800) for what Tesla calls FSD. While the company markets its features as self-driving, they require constant human supervision and frequent interventions. Chief Executive Officer Elon Musk has for years been seeking regulatory approval for FSD to be allowed to operate on Chinese roads and been aiming to launch the system in China this year.

Tesla has offered employees in China the chance to test out FSD as part of a pilot before the features are rolled out to the public, according to two people familiar with the matter. The company has required workers to sign confidentiality agreements, the people said.

Spokespeople for the carmaker didn’t immediately respond to requests for comment. Tesla shares fell as much as 3.9% amid a broader decline in tech stocks Monday before closing 2.2% lower in New York.

Musk traveled to Beijing in April of last year to meet with officials including Premier Li Qiang about deploying FSD in China. The company reached a mapping and navigation deal with Chinese tech company Baidu Inc. and cleared requirements for how it handles data-security and privacy issues.

China’s Ministry of Industry and Information Technology, the main regulator and supervisor of driver-assistance functions, didn’t immediately respond to a request for comment.

Still, Musk said during Tesla’s quarterly earnings call last month that the carmaker was facing challenges with FSD in China, citing limits that both Beijing and Washington had placed on how the company trains its system to handle local roads. The CEO said engineers were resolving the issues by looking at videos of streets in China that are available on the internet and using that footage for training.

Tesla has drafted language for the software update cautioning that the timing and effectiveness of some features may vary depending on the vehicle model and configuration. The feature for city streets will be introduced on select models and be gradually expanded, the person said.

Driver-assistance technology is becoming increasingly common in China, with EV leader BYD Co. recently having announced a system it’s marketing as God’s Eye. The manufacturer is offering different tiers of capability and hardware as standard features on cars starting at just 69,800 yuan.

Tesla doesn’t disclose how many of its customers have paid for FSD. Take-up has been limited in China as the company has awaited regulatory approval to deploy features.