Tesla is denying rumors that it has pulled its “Full Self-Driving” team out of China, saying its Shanghai data center is “operating normally” and that it has even reported the claims to police.
The denial comes as China remains conspicuously absent from Tesla’s own list of markets where customers can subscribe to FSD because of the regulatory limbo the driver assist system faces.
What the rumors claimed
Rumors circulated on Chinese social media on Tuesday claiming that Tesla’s Shanghai data center — set up specifically to prepare the ground for a “Full Self-Driving (Supervised)” launch in China — had been vacated, its liaison teams withdrawn, and related positions eliminated.
The speculation fed a broader narrative that Tesla is quietly retreating from its long-delayed effort to bring FSD to the world’s largest EV market.
Tesla China pushed back hard. Responding to Chinese outlets Tencent Tech and National Business Daily on Wednesday, the company said the Shanghai data center “is operating normally,” that recruitment for driver-assistance roles is actually accelerating, and that the work is “progressing steadily,” according to CnEVPost.
Tesla also said it reported the rumors to police — an aggressive move that signals how sensitive the automaker is about any suggestion that its China FSD effort has stalled.
The problem is the market list
China does not appear on Tesla’s updated list of 12 markets where FSD (Supervised) subscriptions are offered — a list that includes the US, Canada, Australia, South Korea, and several European countries. Yet Tesla’s US website still lists China among markets where FSD Supervised is “available for use.”
That contradiction has been the through-line of Tesla’s China autonomy story all year. Tesla announced FSD availability in China back in May 2026, then renamed the software “Tesla Assisted Driving” on its Chinese site. But it has never published subscription pricing or a broad rollout timeline for Chinese customers.
We reported in February that Tesla secured AI training capability inside China, a genuine and necessary step given Beijing’s rules on keeping data local. And we covered in January how Chinese regulators shut down Elon Musk’s claim that FSD would be approved “next month”. The pattern of announced progress meeting regulatory reality has been consistent.
Local rivals aren’t waiting
While Tesla manages rumors, Chinese automakers are shipping. Domestic players including Xiaomi and Huawei have been rapidly expanding urban driver-assistance features that operate on city streets across China — the exact capability Tesla is still trying to get cleared.
Xpeng is preparing to launch an upgraded version of its own level 2 driver-assist system, which is already competitive with Tesla’s nerfed version of FSD in China.
That competitive gap is what makes the rumors sticky. Tesla’s China business is under pressure from a wave of cheaper, feature-rich local EVs, and its assisted-driving software was supposed to be a differentiator. Every month without a clear FSD rollout is a month rivals use to entrench.
Author: Fred Lambert
Source: Electrek
Reviewed By: Editorial Team
