Tesla Pauses FSD Trial in China to Seek Regulatory Approval

Tesla, Inc. TSLA is preparing to launch its smart driving assistance feature in China once it secures regulatory approval. The decision followed concerns over a temporary pause in a limited-time free trial of its Full Self-Driving (“FSD”) service.According to a message posted on Weibo by Grace Tao, Tesla China's vice president of External Affairs, the company is complying with China’s newly introduced regulations. These rules, issued in late February, require regulatory approval for over-the-air software updates related to autonomous driving. Tesla is currently finalizing approval for its intelligent assisted driving software, which corresponds to its 3.0 and 4.0 hardware versions.The company previously announced that the free FSD trial in China would run from March 17 to April 16. FSD, powered by generative AI, is designed to handle more complex traffic scenarios.Per Reuters, Tesla is targeting a full rollout of FSD this year and has partnered with Chinese tech giant Baidu to enhance the system’s performance. Unlike in the United States, where FSD operates without needing continuously updated navigation maps, Tesla faces challenges in China due to strict data laws. The company has been unable to train its AI with real-world data from its 2 million EVs in the country, which limits its ability to refine the technology.Per Elon Musk, Tesla faces challenges in China, a massive market, due to restrictions on data transfer. China does not permit TSLA to move training video footage out of the country, while the U.S. government prohibits it from conducting training within China, putting the company in a difficult position.TSLA’s Zacks Rank & Key PicksTesla carries a Zacks Rank #3 (Hold) at present.Some better-ranked stocks in the auto space are China Yuchai International Limited CYD, Dana Incorporated DAN and Strattec Security Corporation STRT, each sporting a Zacks Rank #1 (Strong Buy) at present. You can see the complete list of today’s Zacks #1 Rank stocks here.The Zacks Consensus Estimate for CYD’s 2025 sales and earnings indicates year-over-year growth of 9.17% and 36.84%, respectively. EPS estimates for 2025 have improved 25 cents in the past 30 days. The Zacks Consensus Estimate for DAN’s 2025 earnings implies year-over-year growth of 70.21%. EPS estimates for 2025 and 2026 have improved 10 cents each in the past 30 days.The Zacks Consensus Estimate for STRT’s 2025 sales indicates year-over-year growth of 2.61%. EPS estimates for 2025 and 2026 have improved 91 cents and $1.06, respectively, in the past 30 days.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Dana Incorporated (DAN): Free Stock Analysis Report Tesla, Inc. (TSLA): Free Stock Analysis Report Strattec Security Corporation (STRT): Free Stock Analysis Report China Yuchai International Limited (CYD): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks