Elon Musk's Tesla Has Won Preliminary Approval To Roll Out 'Fully Self Driving' Technology In China

After a surprise visit to Beijing,

Musk has reportedly received a big green light from Chinese officials.

This clears a significant regulatory hurdle in Tesla's second most important market behind the U.S.Why is this a big deal?

Despite an extremely challenging start to the year (shares down ~30% YTD).The mass adoption of FSD represents the next big opportunity (and challenge) for the long-term Tesla growth story.Mass adoption of FSD would enable Tesla to capture software-like margins (vs the current 17-20% gross margins on vehicles).

This could be achieved via purchases of FSD within Tesla vehicles.Or licensing the software to other automakers.*Or via a potential 'robo-taxi' fleet in the future*And they are making progress...Tesla recently surpassed 1 billion miles driven using FSD.Quite remarkably, this figure was at ~700,000 just ~6 months ago.

Clearly a big growth metric that they are focusing on.Musk claims that Tesla will spend as much as $10 billion on AI this year to power this technology.Tesla shares are up ~12% in pre-market on this news.Catalyst.

I think this is a big step for Tesla. Next important part is its Robotaxi event on 8th Aug