Tesla registers insurance brokerage in China, national corporate database shows

BEIJING (Reuters) – Tesla (NASDAQ:) registered an insurance broking firm in China at the end of July, based on a national corporate information database, in a sign that the U.S. automaker may be trying again to gain approval to sell insurance products in the country.

The new company, located in Beijing’s Central Business District, was set up on July 30 with a registered capital of 50 million yuan ($6.92 million), the National Enterprise Credit Information Publicity System showed.

Tesla had sought regulatory approval to sell insurance products in China more than three years ago when it had registered a company in 2020 but removed that registration in April this year.

Electric vehicles are expensive to repair, posing a challenge to insurance providers accustomed to the demands of conventional combustion engine vehicles.

By selling insurance directly to consumers, Tesla could potentially offer lower-cost EV insurance products, which are usually more expensive than those for gasoline cars.

Tesla did not immediately respond to a Reuters request for comment.

Tesla’s biggest Chinese rival BYD (SZ:) was approved to take over a bankrupt online insurance unit Yi’an P&C Insurance Co last May.

China, Tesla’s second largest market, has increased its support for the U.S. carmaker, which plans to build a data training centre and roll out its Full Self Driving software in the country this year, despite ongoing tensions with the United States over tech rivalry.

Tesla won an endorsement from the country’s top auto industry association that said in April the data collection by Tesla fleets in China was compliant. Since then, Tesla cars have been allowed to enter some government and military compounds where they were previously banned.

($1 = 7.2204 renminbi)