Elon Musk, the chief executive of Tesla, tried for years to convince Chinese regulators to let him offer self-driving capabilities in one of the company’s most important markets.
After a series of false starts, Mr. Musk is now closer than ever.
Tesla said on Tuesday that some of drivers in China will be able to use the company’s Autopilot feature on city streets to help with lane changes and other more advanced tasks. Cars that use the update, which is similar Tesla’s Autopilot feature in the United States, are not completely autonomous and still require supervision from the driver. The update is available to Tesla owners who paid an extra $8,800.
The news marked a breakthrough for Mr. Musk in China, where his company has faced increasingly tough competition. It is an important step toward Mr. Musk’s goal of offering full self-driving in China, something that would help Tesla to claw back some of the market share it has lost in recent years.
Mr. Musk has identified autonomous-driving technology as critical to Tesla’s future. The company has fallen behind in China, where regulators have been slow to approve its latest self-driving functions. Days after stressing the importance of the technology to investors last year, Mr. Musk traveled to Beijing to meet with China’s No. 2 official, Li Qiang. Not long after, Tesla was among a group of Chinese automakers to receive approval for their data security precautions on some models.
Mr. Musk has since ascended to a position of power in the U.S. government as an aide to President Trump, who is sparing with China over trade policy.
Getting approval for its most advanced self-driving technology would help “give Tesla three to five more years of technology leadership in China’s hypercompetitive electric vehicle market,” said Michael Dunne, an auto consultant and former General Motors executive.
Tesla was once the dominant player in China, expanding in a market where it has been given perks few other foreign businesses have been afforded. These days, Tesla is racing to keep pace in China with local rivals. Its biggest competitor, BYD, recently announced an assisted-driving system that uses artificial intelligence and other advanced technology.
Mr. Musk has been working to convince regulators to roll out full self-driving approval. But, as Mr. Musk recently described it to investors, Tesla is stuck between Chinese regulations that prevent it from taking data out of the country to train driving models and American authorities that will not let it train its self-driving systems in China.
While Tesla has a data center in Shanghai that has collected years of data from the cars it has sold in China, that information cannot leave the country. Tesla is currently using videos of streets in China available on the internet to inform its training, Mr. Musk told investors on a recent earnings call.
It’s part of an issue that relates to the broader digital curtain that is being drawn between the United States and China as relations between the two economic powers worsen. Last year, the Biden administration effectively banned Chinese electric vehicles and Chinese-developed software used in internet-connected cars.
For Tesla, “the key is whether its computing power training and other things can be localized in China,” said Cui Dongshu, secretary general of the China Passenger Car Association. “If you don’t set up a computing center in China, you can’t calculate these things and you can’t adapt to the driving ability of Chinese roads.”
Li You contributed research from Beijing and Claire Fu contributed reporting from Seoul.