Tesla and Baidu are reportedly forming a major collaboration following Elon Musk's China trip. This collaboration is crucial to incorporating driver assistance technology into the world's largest car market, China.

Elon Musk posted a photo of his meeting with Chinese Premier Li Qiang on X during his unexpected weekend visit to China.

Baidu, China's online search leader, will offer mapping and navigation services for Tesla's "full self-driving" (FSD) driver assistance system. Notably, the country heavily restricts mapping services, according to The Guardian.

Although "full self-driving," Tesla's technology needs a driver to stay alert and take control at any time. Tesla's launch in China might boost sales and give it as the competition in the electric vehicle sector gets more fierce. However, the FSD feature is not available in all locations and costs $8,000 or $99 each month.

Improving US-China Relationship?

During his China visit, Elon Musk's tone toward the Chinese government was more conciliatory than his usual aggressive tone with politicians, as shown in his critiques of US President Joe Biden and fights with Brazilian authorities over X censorship. Musk was "honored" to meet Li, China's second-most powerful politician.

The Beijing Auto Show opened during Tesla CEO Elon Musk's unexpected visit to China, according to CNN. Analysts see the Tesla-Baidu partnership as a turning moment for the EV maker in China, given the fierce rivalry between Chinese EV makers.

Tesla's autonomous driving goals depend on FSD access in China, according to Wedbush Securities analyst Dan Ives. Ives also argues that Tesla might expedite worldwide autonomous driving algorithm training if it gets clearance to send Chinese data outside.

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In the face of rising competition, analysts believe Musk's visit will strengthen Tesla's influence in China. This visit follows US Secretary of State Antony Blinken's signaling attempts to normalize US-China relations.

Premier Li said Tesla was a testament to US-China economic unity. He stressed the benefits of collaboration for both nations. The tech billionaire responded by praising Tesla's Shanghai Gigafactory and promising more collaboration.

(Photo : GREG BAKER/AFP via Getty Images) 

Tesla CEO Elon Musk gets off a minibus before boarding his private plane at Beijing airport on April 29, 2024. Musk -- one of the world's richest people -- arrived in China on April 28 on his second trip in less than a year to the world's biggest market for electric vehicles.

Tesla's New Venture Boosts Shares

Elon Musk's numerous economic interests have complicated his connection with China. Due to censorship concerns, China barred X, but Tesla's manufacturing in Shanghai remains in the country. Tesla's Model Y placed third in China's March 2024 electric or plug-in hybrid car sales.

Tesla investors, who consider autonomous driving crucial to Tesla's standing as the world's most valuable automaker, are excited about Elon Musk China visit and Tesla-Baidu partnership. Before the New York markets opened, Tesla's share price rose 6% due to this enthusiasm.

The China Association of Automobile Manufacturers says Tesla passed a crucial data security test, per Bloomberg. Data security concerns hindered Tesla's aspirations for self-driving technology in China. Tesla made tremendous progress by meeting these data security criteria.

In 2020, Tesla changed to Baidu for in-car mapping and navigation, and this deeper relationship reflects a focus on autonomous driving mapping demands.

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