Tesla's Legal Tactics in China Spark Controversy and Debate

In China, Tesla has adopted a highly assertive legal strategy to counter criticism by taking legal action even against its own customers. One notable case involved Zhang Yazhou, a proud Model 3 owner, who protested about alleged brake failures that resulted in a serious accident. When her claims were disputed by Tesla as false, the company sued her for defamation, leading to a court ruling that required her to pay damages and issue a public apology. Zhang, contesting the verdict, maintained that her comments were simply expressions of consumer dissatisfaction and that she had the right to voice her experience.

This aggressive legal posture is not typical among automakers globally, and Tesla’s repeated success in such lawsuits raises questions about fairness, especially when juxtaposed with its favorable political connections. Tesla's high level of commercial success in China has been significantly influenced by backing from influential political figures and state patronage, which has provided it with benefits such as low-interest loans, tax breaks, and regulatory privileges. These advantages have been critical since Tesla built its first overseas factory near Shanghai and continues to match its rapid business growth with robust support from government-backed institutions.

Furthermore, Tesla has not limited its legal pursuits to individual consumers; it has also targeted media outlets and bloggers who have reported negatively about its vehicles and practices. Reports indicate that several Chinese media organizations and independent journalists have faced legal pressures, leading to self-censorship in news coverage about the company. The consistent judicial support for Tesla in these cases contrasts with a limited number of wins achieved by consumers in similar lawsuits, suggesting that the legal environment may be disproportionately in favor of the automaker.

Industry experts and critics alike express concern that Tesla’s legal victories send a chilling message to those who might otherwise expose or question the company’s practices. The broader implications of these cases are seen as reflective of a judicial system where the influence of party politics and government connections can tilt the balance, reducing the accountability of even the world’s largest companies.