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Tesla says it can’t make affordable autonomous vehicles without China’s help

Tesla CEO Elon Musk attends the Tesla Shanghai Gigafactory groundbreaking ceremony in Shanghai, China January 7, 2019.
Reuters/Aly Song
Embracing the future.
  • Dave Gershgorn
By Dave Gershgorn

Artificial intelligence reporter

If Tesla CEO Elon Musk is ever going to sell fully autonomous cars, it seems as though he’s going to need China to help him do it.

Since July 2018, Tesla has petitioned the US government to exclude an electronic control unit for its Model S, Model X, and Model 3 from a 25% tariff when importing the part, according to government filings obtained by Reuters and TechCrunch. Authorities have denied the requests for the Models S and X, and the Model 3’s request is still pending.

The electronic control unit that Tesla is trying to exempt was described as the “brain” of the car in the documents. At a company event last month, Elon Musk said that this Autopilot 3.0 hardware would be the technology to allow full self-driving capabilities on Tesla vehicles. While Tesla designs all of these hardware components internally, it relies on other companies around the world to actually manufacture the parts on a large scale for the production of vehicles.

But Tesla claims that since its timeline from development to production is only six months, there are no other countries that can deliver defect-free parts on such a short timescale.

“Tesla was unable to source manufacturing for Autopilot 3.0 ECU in the United States,” a filing from the company reads. “We turned to industry experts who could achieve this quality and complexity in addition to the deadlines, which was not possible outside of China.”

Quanta Computer’s Shanghai location, where Tesla is manufacturing the parts, isn’t solely responsible for the technology, TechCrunch notes. One of the chips that speeds up the AI processes on the Autopilot 3.0 hardware is made by Samsung in Texas, for example.

These parts are crucially important to the future that Musk envisions for Tesla. He said last month that his cars would be “appreciating assets,” meaning they would become more valuable over time, due to enhancements of the self-driving software being updated on the Autopilot 3.0 hardware.

Update: This article has been updated to clarify that Tesla designs its own hardware, but relies on outside companies to manufacture parts for vehicle production.

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