Three Things the CCP Wants From Tesla
Hello, everyone, welcome to “Inconvenient Truths”. I am your host Jennifer Zeng.
A while ago I did a program about Tesla being banned from China’s military buildings. Recently Tesla once again became a very, very hot topic in China, especially on social media platforms. What has happened, why did these things happen, and what are their significance? Today let’s discuss these very interesting issues.
A Drama At the International Auto Show in Shanghai
First of all, let’s watch a video together.
This video was shot on April 19, at the media preview of the international auto show in Shanghai. You can see this woman jumping on top of a Tesla Model 3. She screams loudly, “Tesla Brakes Failed!” The T-shirt she wears also has the Chinese words saying “Brake Failure”.
Another woman dressed in the same T-shirt also shouts “Tesla Brakes Failed!” This shows that this was an organized, pre-arranged “protest”.
This is a shot from another angle. This is a shot from outside the exhibition hall. This is the shot of that woman being taken away by the security guards.
It was then reported that this woman claimed that because of a Tesla car's brake failure, 4 members of her family nearly died when their car crashed into the car in front of them in Henan province in February this year, but Tesla refused to take responsibility. So she went to the Shanghai Auto Show to “defend her rights' '.
Right after the episode at the auto show, on the following day, CCP’s biggest mouthpiece Xinhua published an article entitled, “Who Gives Tesla the Confidence to Maintain Its ‘No Compromise’ Stance?” The article criticized Tesla for being “arrogant.”
CCP’s other most important mouthpiece People’s Daily also published an article on April 22, saying that “There are no products that cannot be replaced”. The article also says that, “People can only see the arrogance of Tesla, but not its sincerity to solve the problem, or respect for its consumers.”
What’s more ridiculous is that even the CCP’s Central Political and Legal Affairs Committee also got involved into this public opinion war against Tesla, and also published an article on April 20, saying that Tesla must comply with China's laws and regulations if it wants to do business in China, and that Chinese consumers’ trust cannot be exchanged for arrogance, and Tesla should not knowingly ignore the hidden safety problems, etc.
People were very surprised by this article, because the Political and Legal Affairs Committee usually only deals with political and legal affairs, and it is best known for its persecution of Falun Gong and other innocent people. Why did it suddenly get itself involved in an affair between a manufacturer and its customer?
More Boycott
And this affair didn’t stop at the verbal level only. Instead, it soon expanded to the real world.
Let’s watch another two short clips.
This clip shows that Tesla cars were stopped and not allowed to enter the highway somewhere in Guangzhou City. The man says, “Alas, another Tesla car got caught. ”
Now let’s play another video.
Judging from the accent of the video, it should be in Henan province. So Tesla cars are not allowed to park there.
Now let’s play the next video.
The sign in this video we just saw says, “Military Area. Tesla cars Are Forbidden.”
Court Ruling: “Refunding one, Compensating for Three”
Apart from these, Tesla may soon face new trouble, which is a compensation court ruling.
On Dec. 4, 2020, in Tianjin city, a Tesla owner named Han Chao received a court verdict for his compensation claim against Tesla. The verdict stated that Tesla had committed fraud and should return 379,700 yuan (about $59,000) to Han for the purchase price and to pay him 1,139,100 yuan (about $176,000) in damages.
The amount of compensation for damages is three times the purchase price—in China, this verdict is therefore called “refunding one, compensating for three.”
Tesla appealed the ruling and a verdict will be announced by May 3.
But Tesla told a different story in a statement published on its official Weibo account on April 28.
The statement says, the original owner of Han's car had been involved in a minor accident in early 2019 and commissioned third-party repairs. Various documents from the accident claim could confirm that the accident only injured the left rear fender, the edge of the rear bumper and the surface of the wheels, but did not involve the safety structure of the vehicle. The repair of the fender would not cause a safety hazard to the vehicle.
Tesla says in the statement, ”We appreciate the regret caused by Mr. Han's dissatisfaction after purchasing the car, but believe that this does not constitute fraud.”
The statement also says that during the repair service of Han's vehicle, Tesla provided another car to Han, but he refused to return that car after his vehicle was repaired and refused to pick it up. The alternative car was not returned until after it was involved in an accident. After that Han requested to have a third car, which was provided to him while the negotiation between him and Tesla continued, under the condition that he should return it in one month. However, he refused to return that car after the expiration date and is still using it to this day.
When I read Tesla’s statement, I tend to believe in Tesla instead of Han Chao, or the CCP’s court. I actually felt sympathy towards Tesla for having to deal with this kind of person.
Three Things the CCP Wants
Now, let’s talk about what’s behind all the drama on the surface.
First of all, we need to understand that in CCP’s China, everything is under tight control, especially what can be a hot topic in the media, and social media platforms. It is hard to imagine that some simple disputes between a car manufacturer and its customers can become so hot in the media. The fact that the CCP’s most important mouthpieces Xinhua and People’s Daily, as well as its Central Political and Legal Affairs Committee all got involved and directly criticized Tesla indicated that the CCP is behind all of this drama.
So, what does the CCP want from Tesla?
Anti-American Sentiment
No. 1: Anti-American sentiment.
Let’s see a table before we go on. What you are seeing are the figures released by China’s Passenger Car Association in October last year, about the complaint to sales ratio of all the best selling passenger cars in China in the third quarter of last year. You can see that Tesla’s Model 3 is on the top, it received only 0.3 complaints out of every 10 thousand sales.
The complaint to sales ratio of all the best selling passenger cars in China in the third quarter of 2020. Source: China’s Passenger Car Association.
On the bottom of the table is the average complaint figure of all the best selling passenger cars. It is 33.5 per 10 thousand sales.
That is to say, the average complaints are more than 100 times higher than that of Tesla’s. Or maybe we can also say that customers are more than 100 times happier with a Tesla car.
So, quality is definitely not the issue. Nor is the issue about protecting the interests of consumers, as we’ve seen other cases in which consumers’ interests were never considered. For example, hundreds of thousands of children became victims of the poisonous milk powders produced in China, some even died, but the CCP never cared.
Therefore, this wave of bombardment of Tesla is purely a political operation with very obvious concerted actions. The CCP used a very skilled technique to incite public disgust at Tesla's “bullying”, and then converted the disgust toward Tesla into disgust and hatred for the United States, as Tesla is a US company.
Let’s see Xinhua's article again. “Who Gives Tesla the Confidence to Maintain Its ‘No Compromise’ Stance?” As Chinese readers have long since been instilled such a view that "the U.S. Imperial is the source of all evil”, when they see such a title, they will easily come to the conclusion that Tesla is so arrogant because it thinks it is an American company and the dark force of the U.S. Imperial is behind Tesla.
We’ve already seen the CCP's aggressive Wolf Warrior Diplomacy all over the world recently. So to have the general public in China maintain a similar stance about the US is nothing strange.
So that is the No. 1 purpose the CCP wants to achieve.
The Market
The No. 2 goal is the market.
Xi Jinping announced as early as in 2014 that the development of new energy vehicles was “the only way to go” for China to become a strong country in automobile manufacturing. With many countries taking the climate change agenda as a priority, new energy vehicles are definitely a huge global market.
China has already put itself in a very good position with solar panels, wind power generation, etc, it definitely would want to dominate the new energy vehicle market too.
And you know what? After the CCP backed company Huawei being sanctioned by the US for safety concerns, it has dropped off the list of top cell phone makers in the world. Its first quarter revenue slipped 16.9% this year. A while ago it also announced that it would get itself involved in the smart pig farming business.
And, on the same day when that woman jumped on top of a Tesla car to make a scene, Huawei also appeared at the auto show for the first time as a new energy vehicle maker!
Let’s watch a short clip first.
OK, this video was shot at the Huawei booth, showing that the chandelier structure collapsed. Huawei had to make an urgent repair after this incident. It seems to not be a good start for Huawei as a car maker.
Anyway, we must say that Huawei acted very fast to embark on this new route of making electric cars. As a telecommunication company, during the process of rolling out its 5G programs, it has already accumulated technology with the Internet of Vehicles, Internet of Things. So it already has the foundation to make smart cars.
Also, it didn’t try to do everything from scratch. Instead, it chose to work with car makers that are already in this area. It is now working with three different car makers including BAIC Motor in Beijing, Changan Auto in Chongqing, and GAC Group in Guangzhou.
It has launched the ARCFox S model with BAIC Motor .This model was also in the Shanghai auto show, with a price range from 250K-344K yuan, or $38K-$53K. This price range is very close to Tesla’s price in China. Many other brands have set a much lower price.
So from this we can see that Huawei has set Tesla as its main market competitor by entering the same price range.
We all know what a big fuss the CCP has made after Canada arrested Huawei’s CFO Meng Wanzhou under the request from the US. The CCP has even sentenced 4 Canadians to death after Meng Wanzhou was arrested.
From this, it is not hard to imagine at all if Huawei, and other CCP owned companies want to enter the same market, what the CCP is willing to do to drive the outsiders out.
And there is an important fact to mention here too. April 19, the day when that woman made a scene at the Shanghai auto show, was the date for a media preview. Only people who work for the media could get a pass to get in. So how did that woman make her way there?
It turned out that she actually got a media pass from Webasto, a sunroof supplier of NIO, one of the main Chinese electric car makers.
It was also revealed that when the woman arrived at Shanghai from Henan province, she didn’t take a taxi. Instead, she was picked up by a NIO car.
This was not a rumor spread by others. Instead, it was found out from a video posted by the woman herself. She posted a video onto her TikTok account just to show that she had arrived Shanghai to “defend her rights”. But netizens soon found out that the car she was riding belonged to NIO. She quickly deleted that video.
So now you get the story? Her so-called “protest” had the backing not only from the CCP’s most important mouthpieces, powerful government departments such as the notorious Political and Legal Affairs Committee, but also from Tesla’s main competitor, or competitors.
The Data
What is the third thing that the CCP wants from Tesla? It is the data.
We all know how important data is in such a digital world and a digital era we are living in, especially for totalitarian regimes that want to control its people.
So far Tesla has not set up a data center in China, or stores the data of its Chinese customers in China.
We all know that Apple has set up an iCloud center in Guizhou, China, and all the data of Chinese iPhone users, and perhaps users in other countries but who choose to use its simplified Chinese language operation system, is stored in the iCloud in China. And Apple’s iCloud service is run by a company owned by the government of Guizhou province. That means the CCP can have access to all the data any time it wants.
Some people also say that the CCP also wants core technology from Tesla, and might not be happy with Tesla because of its StarLink project, as the project offers satellite Internet access worldwide, and has the potential to reduce the CCP’s Great Fire Wall to nothing. I am not too sure about this one, but think it’s worthwhile to mention it here.
OK, that’s all for today’s Inconvenient Truths. Tesla ran against the tide by entering China in 2018 when the trade war between China and the US had just started, and when many other companies were moving their factories out of China. Is Tesla’s decision to enter China a wise one, or a wrong one? I do like to hear what you have to say. Please leave us a comment to share with us your thoughts.
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4/30/2021*
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