Tesla bows to Beijing once again, unveils Shanghai data centre to meet cybersecurity requirements

All data generated from cars sold in mainland China will be stored within the country, company says in Weibo post

Strengthened rules a result of government’s national security concerns, need to safeguard consumer interests, analyst says

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The Tesla Gigafactory in Shanghai. Tesla’s sales in China hit a blip in April after angry customers raised concerns about the safety and quality of its Shanghai-made EVs. Photo: Reuters

Published: 3:27pm, 26 May 2021Updated: 9:58pm, 26 May 2021

US electric vehicle (EV) giant Tesla has set up a data centre in Shanghai to locally store all data collected from its customers in mainland China, a move that is likely to set the tone for all overseas technology companies eyeing the Chinese market.

“We have set up a data centre in China to locally store data – collected by Tesla vehicles sold in mainland China – and we will add more. All data generated from cars sold in mainland China will be stored within China,” the company said in a post on China’s Twitter-like social media platform Weibo on Tuesday.

Tesla has faced a backlash from customers and officials in China, the world’s biggest EV market, over data. The country has required foreign companies to store user data on its soil since 2017, when its Cybersecurity Law came into effect, but has stepped up implementation of late. For instance, the set up of Tesla’s data centre follows a decision by Apple to host the iCloud accounts of its Chinese users in a new data centre in China’s southwestern Guizhou province.

“Handling of data is a serious issue facing the world’s leading technology firms that operate in China,” said Yale Zhang, managing director of Automotive Foresight, an industry researcher in Shanghai. He added that a strengthened regulatory framework governing data collected by EV companies had resulted from not only the government’s national security concerns, but also from the point of view of safeguarding consumer interests.

The data centre is not the first time Tesla has ceded ground in China. Late last month, it released the data log of a Model 3 that crashed in February in the country’s central Henan province to the car owner, after a wave of criticism over its safety and quality standards on social media. The owner, identified as Zhang Yazhou, jumped atop a Model 3 on display at the Shanghai Auto Show 2021 on April 19 to protest against the carmaker, claiming a brake malfunction had caused the crash.

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