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Distrust of Tesla grows in China as state bans EVs from government areas, report says

The country previously banned Tesla cars from military areas, but the restrictions reportedly continue to grow.

Tesla Model 3
China isn't a big fan of Tesla right now.

Chinese government officials have fewer places to drive their Tesla, according to a report from Reuters Friday. The news agency reported China has now banned all Tesla EVs from government compounds and agencies. The ban will not even allow Tesla owners to park inside one of these area, according to Reuters' sources.

Tesla does not operate a public relations department to field requests for comment, but the escalation follows a series of other reported actions against Tesla. For government personnel, the Chinese Communist Party remains wary of Tesla vehicle technology, which can track how a driver uses their vehicle. The government first restricted Teslas from military compounds earlier this year, according to a previous report. That prompted remarks from CEO Elon Musk to cool fears of Tesla vehicles "spying" on owners.

Musk told an audience at the China Development Forum this past March the company would be "shut down" if it spied on drivers in China or anywhere in the world. Still, the Chinese government's grip continues to cause headaches for Tesla as it insists onboard cameras and sensors may track or record sensitive information. Although other vehicles on sale in China sport similar equipment for active safety purposes, the government specifically targeted the ban on Tesla, Reuters reported. In recent weeks, Tesla further responded to these government fears saying it would develop a China-based data center and a new platform for owners to manage their data, too.

China remains an important part of Tesla's business, where it continues to sell EVs in large numbers, and operates a production plant. The country is not only the largest market for new vehicles in the world, but also the largest market for electric vehicles by a long shot.