Tesla, China's National Center For Data And Security Concerns

JAKARTA - Electric car maker Tesla said it would build a data center in Shanghai at the end of June. The goal is to handle data collected from consumer electric vehicles.

This announcement comes when China is concerned about the security and privacy caused by the internal cameras in Tesla products. The Chinese military also prohibited Tesla cars from entering the military complex. Meanwhile, the Chinese government also limits the use of Tesla cars, due to concerns about being a source of national security leaks.

The data center development plan was confirmed by Tesla Global Vice President Grace Tao Lin, as quoted by the 21st Century Business Herald. Although, there has been no response from Tesla.

Last week, Tao tried to calm China by saying that data collected from Tesla's electric cars in China were stored in the country.

Tao Lin said this after attending a round table forum organized by the National Development and Reform Commission, China's economic planner.

"Information gathering by all smart cars in the future can follow a standard configuration. In this process, it is necessary to cooperate with regulatory authorities at all levels, to formulate a comprehensive plan so that consumers can enjoy comfort and safety", said Tao, launching Global Times, Wednesday, April 14.

Meanwhile, Tesla CEO Elon Musk said the company would never use its products to spy on any country. He emphasized that his party would close down the company if the electric car made by Tesla was used for espionage.

"There is a very strong urge for us to keep any information secret. If Tesla uses cars to spy on China or anywhere else, we will be shut down", Musk said at a forum called the China Development Forum which was held online.

Data & information

Regarding personal information and data, China's Ministry of Industry and Information Technology this month launched a draft regulation stipulating that personal information and important data collected and generated during domestic operations must remain within the region, with special reference to smart vehicle makers like Tesla.

Much earlier, China had asked foreign companies to store user data in its own country since 2017, when the Cybersecurity Act was enacted.

Foreign businesses in China are required to comply with regulations if they wish to access Chinese consumers. In early 2018, for example, Apple decided to host Chinese users' iCloud accounts at a new Chinese data center in Guizhou.

This move means that Chinese authorities can ask Apple directly to hand over Chinese users' iCloud data, without having to go through the US legal system to retrieve data stored in the US.

Analysts say securing the vast amounts of data now coming from vehicles comes with its own complexities. Vehicle data covers a wide range of categories, from personal user information to data about the vehicles themselves, according to Forrester principal analyst Charlie Dai.

"While user privacy is important, data is also important for driver safety and national security. It is imperative to ensure appropriate local storage of vehicle data. As this will promote ecosystem collaboration between international manufacturers and local partners", said Dai, launching the Korea Times, Wednesday, April 21.

China is not unique in building legal frameworks for upcoming technologies, such as autonomous vehicles while pushing for legal protection of user data.

However, the country has traditionally considered location data sensitive. For example, when Coca-Cola decided to equip its trucks with GPS trackers in 2013 for better efficiency, the company was eventually investigated for illegal mapping of sensitive areas.

For Chinese authorities, sending smart car data abroad will be a problem for a variety of reasons, said Mark Schaub and Atticus Zhao, lawyers specializing in the auto industry at the King & Wood Mallesons Corporate & Securities Group.

"First, they will see it as personal information of Chinese consumers. Second, there will be large transfers. Third, the information transferred abroad will be sensitive, because it contains geospatial information that will show where and how people are moving", said Schaub

China's draft guidelines are also meant to address another important area for smart cars, namely cybersecurity. As cars are equipped with more internet-connected software, supporting everything from entertainment systems to autonomous driving features, they are also exposed to more cybersecurity attacks.

This not only endangers the entire transportation and logistics system but also endangers people's lives. This has proven to be a costly problem for some carmakers.

Carmaker Chrysler recalled 1.4 million vehicles in 2015 after a pair of hackers demonstrated they could remotely hijack a Jeep via an internet-connected entertainment system.