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Tesla faces uphill battle for FSD entry as China rewrites self-driving car rules: analysts

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Themis QiPublished: 12:06pm, 11 Aug 2026

The likelihood that US electric vehicle (EV) giant Tesla will obtain Beijing’s approval for higher-level autonomous driving remains a distant prospect, according to analysts.

Though Tesla recently hired people to test its Full Self-Driving (FSD) system in China, many obstacles remained, with data regulation a core issue, they said.

Earlier this month, China outlined its first mandatory standards for autonomous driving systems, setting requirements for vehicles that feature level 3 (L3) and level 4 (L4) self-driving functions.

The standards, set to come into effect on July 1, 2027, would hold carmakers accountable for accidents that happen when the system is active and require systems to leave at least 10 seconds for the drivers to take control of a car before a potential accident, which was stricter than the global standards set by the United Nations in June, according to China’s Ministry of Industry and Information Technology.

“The foundation [of the approval] would be the regulations over data,” said Xing Lei, an independent analyst and founder of automotive platform AutoXing.

L3 capability refers to “hands-off” driving in a conditionally automated vehicle, while L4 is defined as technology where drivers can be “minds-off”, according to a set of standards published by SAE International.

Tesla’s FSD is currently at the L2+ level, which means the US giant would not yet meet China’s latest requirements, Xing said. However, Tesla may prioritise its FSD full entry into China over L3 or higher approvals, according to Xing.AdvertisementSelect VoiceSelect Speed00:0000:001.00x