Elon Musk tells China that Tesla will not share data

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News that

Tesla

there could be a Chinese issue that divulged shares a bit on Friday.

China, after all, matters a lot to all electric vehicle manufacturers and Tesla is the most valuable electric vehicle manufacturer of all. Now CEO Elon Musk has addressed the issue. And he doesn’t seem too worried.

On Friday, the Wall Street Journal reported that the Chinese government could stop driving Tesla vehicles (ticker: TSLA) for national security reasons. The moment coincided with talks between the United States and China in Alaska that turned into a back-and-forth contention over human rights and democracy.

Shares of Tesla fell in early Friday, but ended the day at around 0.3%, while that of

Nasdaq Composite

gained 0.8% and the

S&P 500

fell a little.

Reuters reported on Saturday that Musk told Chinese listeners that his company has a strong incentive to be very careful with any information the company may collect or the sensors and cameras in its cars.

“If Tesla used cars to spy on China or anywhere else, we would shut down,” Musk told Reuters.

In terms of stocks, the problem with the Chinese government seems to be small, but investors need to keep it up because China is critical to the company’s success. China is the largest market for new cars and new electric vehicles. Wedbush analyst Dan Ives describes China as the basis for the company’s future growth. It values ​​Tesla shares as Hold and has a target price of $ 950 for the shares.

“At a time of some tensions between the United States and China, Musk & Co. are in a unique position, along with

apple

“To be caught in the crossfire,” Ives wrote in a report on Friday. He added that while he did not expect the situation to get out of control, he was watching the events closely.

Tesla shares have fallen in recent weeks, but not because of geopolitical tensions.

Higher interest rates have affected Tesla shares. High rates hurt higher-growth stocks like Tesla more than others. For starters, higher interest rates make it more expensive to finance growth. Second, high-growth companies generate most of their cash flow in the future. Higher rates make the promise of future cash a little less attractive, relatively speaking, than a higher yield on current bonds.

Tesla shares have fallen about 7% to date, behind the comparable returns of the S&P 500 and

Dow Jones industrial average.

Shares are down around 27% from a 52-week high in January. The yield on the 10-year Treasury note has recently risen above 1.7%, up 0.5% in recent weeks.

Write to Al Root at [email protected]