‘s Elon Musk heaped praise on China’s domestic electric-vehicle manufacturers Friday, calling the country’s auto makers “the most competitive in the world.”
The high-profile CEO lauded the growth potential of the Chinese market and highlighted innovations among Tesla’s rivals, in recorded remarks at the World New Energy Vehicle Congress in Haina, at a time when Tesla has come under pressure in China.
Tesla (ticker: TSLA) stock was 0.5% lower in premarket trading Friday. Shares in Tesla’s Chinese rivals were generally higher:
(NIO) was 0.9% higher and
(XPEV) rose 1.1% in the New York premarket, while
(2015.H.K.) stock fell 1.1% and
(1211.H.K.) rose 3.4% in Hong Kong trading.
“Chinese consumers want a car with better-connected and more intelligent features, so we see great potential for connected, full self-driving vehicle growth in China,” Musk said. “I have a great deal of respect for the many Chinese auto makers who are driving these technologies.”
Musk added that China’s EV companies were so competitive because some of them excel in software development.
“It is software that will most shape the future of the automobile industry—from design to manufacturing, and especially autonomous driving,” Musk said.
The Tesla CEO also highlighted the importance of safety in the company’s design process and said that data security was the “cornerstone” of development across the whole industry. His remarks come as Tesla finds itself pressured in China, the world’s largest market for electric vehicles.
The company has come under regulatory scrutiny in China for data security and safety issues in the past year, and faces the prospect of a more consolidated domestic industry to compete against.
Meanwhile, technology analyst Daniel Ives of investment firm Wedbush reiterated Friday his Outperform rating and $1,000 target price on Tesla stock. Tesla shares were slipping to near $752 in premarket trading.
Ives noted the public relations and safety issues for Tesla in China, saying it was a lingering headwind for the stock that was beginning to reverse course.
The analyst said he sees a number of growth levers for the company moving into 2022, including an expansion of supply capacity with the launch of its German factory this year and growing EV demand over the next 12 to 18 months.
Write to Jack Denton at [email protected]