Tesla, Geely, Xiaomi and China’s wider EV supply chain all made headlines this week, underscoring how quickly the competitive landscape is shifting. In China, Tesla is reportedly testing the “full” FSD v14.2 software with employees ahead of a possible broader rollout in Q3, while Geely is said to be moving closer to manufacturing in Spain to reduce tariff exposure in Europe. At the same time, Xiaomi’s SU7 continues to post blockbuster order numbers, and fresh supply-chain pressure in automotive electronics is highlighting why localization is becoming just as important as software in the next phase of the EV market.
Tesla reportedly starts China employee testing for full FSD v14.2
According to D1EV, citing social media leaks from users including “zhongwen2005” and “@极客阿来,” Tesla has begun pushing a China employee test build of its so-called “full” Full Self-Driving software.
Key reported details include:
- Version: FSD v14.2.2.5
- Software branch: 2026.2.9
- Start date of employee testing: from April 29, 2026
- Test fleet: more than 1,000 HW4.0 employee vehicles in China
- Confidentiality terms: employees reportedly signed NDAs with penalties as high as RMB 5 million
- Public rollout timing: most optimistic scenario points to Q3 2026
The leaked information suggests the China internal build matches the version already approved for road use in the Netherlands. A very limited v14.3 build is reportedly being used only for compliance testing, not for employees or end users.
That matters because Tesla’s China FSD story has long been constrained by regulation, mapping rules, and data localization. If this report is accurate, it signals that Tesla is moving beyond a symbolic beta presence and toward a more mature localized deployment path.
What users should watch
Even if Tesla reaches a public rollout in China, the final consumer version may not be identical to the internal employee build. D1EV notes that some features could still be restricted in production software for regulatory reasons, with functions such as automatic reversing among the possible candidates for limitation.
In other words, the big question is no longer just whether Tesla can launch FSD in China, but how much of the North America feature set it can legally retain.
Geely’s Spain move could become a smart tariff workaround
Another major development comes from Europe. Spanish auto outlet La Tribuna de Automocion reported that Geely has reached an agreement with Ford to acquire the Body 3 assembly line at Ford’s Almussafes plant in Valencia, Spain.
If completed, the plan would give Geely a manufacturing base inside the European Union at a strategically important time, as Chinese automakers face growing trade pressure in Europe.
What Geely is reportedly planning
The report says Geely intends to build a new electrified vehicle based on its GEA global intelligent new energy architecture, internally codenamed 135.
Reported specs for the model include:
- Body style: compact SUV
- Dimensions: 4,135 mm × 1,805 mm × 1,570 mm
- Wheelbase: 2,650 mm
- Powertrains: hybrid, plug-in hybrid, and battery electric versions
- Battery options: 30.1 kWh and 40.1 kWh
- CLTC range: 310 km and 410 km
- Rear motor outputs: 58 kW and 85 kW
Foreign media speculation points to a possible EX2 compact EV SUV positioning, though that remains unconfirmed.
Just as important, Ford could also use Geely’s GEA platform for a cooperative model, potentially a successor to the Ford Puma. If that broader partnership happens, Valencia’s output could reportedly recover to more than 300,000 vehicles annually, supporting 4,000+ jobs and potentially creating more.
Why Geely’s Europe strategy matters more than one factory deal
This is not an isolated move. Chinese carmakers are increasingly using European production, contract manufacturing, or local partnerships to soften tariff risks and shorten logistics chains.
Examples cited in the source material include:
- Leapmotor vehicles set for production at a Stellantis plant in Spain
- GAC and XPeng linked to production at Magna Steyr in Austria
- FAW Hongqi reportedly in talks with Stellantis over Spain-based manufacturing
The broader pattern is clear: exporting from China was the first phase of global expansion; local manufacturing in Europe is becoming phase two.
Xiaomi SU7 keeps proving demand is real
While Tesla and Geely are fighting over software and geography, Xiaomi Auto is delivering one of the strongest product-demand stories in China’s EV market.
Xiaomi announced that the new-generation SU7 surpassed 80,000 locked-in orders in 48 days after its March 19 launch. That is a remarkable result in the highly competitive RMB 200,000-300,000 electric sedan segment.
Xiaomi SU7 key numbers
| Model metric | Xiaomi SU7 |
|---|---|
| Price range | RMB 219,900-303,900 |
| Locked orders | 80,000+ |
| Time frame | 48 days |
| Max CLTC range | 902 km |
| 0-100 km/h (Max) | 3.08 seconds |
| Standard equipment | LiDAR, Nvidia Thor-U chip, chassis system |
Xiaomi’s momentum matters because it confirms that China’s EV buyers are still rewarding a strong mix of:
- competitive pricing
- high-end in-car tech
- advanced driver-assistance hardware
- long range
- strong brand buzz
That combination is becoming the new baseline, not the exception.
EV supply chains face new pressure from capacitor shortages
Away from the headline-grabbing car launches, one quieter but important story is emerging in automotive electronics: shortages in Japanese anti-vibration capacitors.
According to the D1EV supply-chain report, fluctuations in upstream materials and production adjustments have led to shortages and longer lead times for Japanese anti-seismic capacitor products used in automotive electronics. That is already affecting customer production scheduling.
Shanghai YMIN Electronics says it is positioning its domestically developed automotive-grade hybrid capacitors as a substitute, highlighting:
- full-size coverage across 6.3 mm, 8 mm, 10 mm and 12.5 mm diameters
- 30G anti-vibration rating
- pin-to-pin replacement capability for Japanese products
- validated use in major automotive systems including:
- electric drive systems
- vehicle control units
- electronic water pumps
- electronic oil pumps
- EPS
- TCU applications
This may sound niche, but it is highly relevant to the EV industry. As software-defined vehicles become more complex, even seemingly small passive components can become production bottlenecks. Localization of batteries, semiconductors, power electronics and passive components is increasingly part of the same industrial strategy.
Market snapshot: software, manufacturing and supply chain are converging
This week’s developments show that the Chinese EV race is no longer just about launching another sedan or SUV. It is becoming a three-layer competition:
| Competitive layer | Key example | Why it matters |
|---|---|---|
| Software and autonomy | Tesla China FSD v14.2 testing | Determines user experience, brand perception and long-term margins |
| Overseas manufacturing | Geely-Spain/Ford report | Reduces tariff exposure and improves local market access |
| Component localization | Capacitor substitution in auto electronics | Improves resilience, cost control and production continuity |
That framework helps explain why the sector is evolving so quickly. In 2021-2023, range, battery chemistry and price were the main discussion points. In 2026, the conversation is broader:
- Can you deploy advanced assisted driving legally and at scale?
- Can you manufacture close to your export markets?
- Can your supply chain withstand geopolitical and component shocks?
Global Implications
These developments have implications well beyond China.
First, Tesla’s China FSD progress could become a key benchmark for how Western autonomous driving systems adapt to Chinese regulatory realities. If Tesla succeeds, it may strengthen the case for a more globally harmonized path to supervised autonomy. If the rollout is heavily restricted, it will reinforce the view that autonomy remains deeply market-specific.
Second, Geely’s Spain strategy shows how Chinese automakers are maturing from exporters into multinational manufacturers. Europe is no longer just a destination market; it is becoming a production theater in the competitive fight over EV cost, tariffs and local political acceptance.
Third, supply-chain localization is proving as strategic as software. The capacitor story is a reminder that industrial resilience is built not only on batteries and chips, but also on the less glamorous components that keep automotive electronics running.
Why This Matters
For consumers, this means better-equipped EVs, faster technology cycles and potentially more localized products built for regional needs. For incumbents, it means competing with Chinese brands that are getting stronger not just in vehicle design, but in software, industrial execution and global manufacturing strategy.
For investors and industry watchers, the takeaway is simple: the next phase of the Chinese EV market will be decided by who can integrate intelligence, scale and supply security most effectively.
What comes next
The next milestones to watch are clear:
- whether Tesla officially confirms a broader China rollout timeline for FSD v14.x
- whether Geely and Ford formalize the Valencia manufacturing agreement
- whether Xiaomi can convert early SU7 order strength into sustained deliveries and margin performance
- how quickly domestic suppliers can replace vulnerable imported automotive electronic components
Taken together, these stories point to an EV industry that is becoming more sophisticated, more global and more vertically coordinated. China’s leading players are no longer competing only on sticker price or headline range. They are competing on software readiness, factory geography and supply-chain depth—and that is a much harder race to win.
