Tesla’s plan to launch its Full Self-Driving (FSD) software has several hurdles to overcome before it can be released to the public, with CEO Elon Musk describing the situation as a “quandary.”
During Tesla’s Q4 2024 earnings call, Musk detailed the challenges the company faces due to restrictions from both Chinese and US governments, making it difficult to train its artificial intelligence (AI) models for autonomous driving in the world’s largest EV market.
According to Musk, China has imposed strict regulations on data privacy, particularly concerning autonomous driving. One of the biggest hurdles for Tesla is that the Chinese government does not allow the company to transfer video data collected from its vehicles out of the country for training purposes. At the same time, the US government also doesn’t allow Tesla to conduct AI training within China due to national security concerns.
“China, which is a gigantic market, we do have some challenges because they currently won’t allow us to transfer training video outside of China. And then the US government won’t let us do training in China,” Musk said.
This has left Tesla in a difficult position, unable to directly process and improve FSD performance using real-world driving data from China.
In response, Tesla has resorted to an alternative and unconventional method – training its AI using publicly available video footage of Chinese streets, road signs, and traffic laws, then fine-tuning FSD using a highly accurate simulator.
During the call, Musk highlighted one of the most complex challenges Tesla faces in China – navigating bus lanes. Chinese cities often have intricate rules regarding when and where vehicles can use bus lanes, with strict enforcement through automated cameras that issue instant fines for violations.
“Bus lanes in China are one of our biggest challenges in making FSD work,” Musk said. “There are literally hours of the day that you’re allowed to be there and not be there. If you accidentally go into a bus lane at the wrong time, you get an automatic ticket instantly.”
Tesla is working to solve this issue by ensuring that FSD can accurately read and interpret street signs, understand time-based restrictions, and integrate this knowledge into its driving decisions. This training is being conducted in a simulator, allowing Tesla to replicate and improve FSD’s ability to handle China’s complex traffic regulations before deploying it in real-world conditions.
Despite all of this, Musk said “we’ll get this solved,” and Tesla reiterated in its shareholder deck that it still plans to launch FSD in China in 2025.
