Tesla Will Use a Powerful New Weapon in AI Race

Tesla will partner up with AI darlings DeepSeek and Bytedance’s Doubao on new tools in its cars in China, according to a document uploaded to Tesla’s official website.

Bloomberg reports that Doubao will work on voice command-related tools like the temperature in a Tesla, navigation, and in-car entertainment, while DeepSeek will handle the AI side of things.

The move may be a way for Tesla to boost its Chinese deliveries, which dropped 8.4% from December to June compared to the same time period last year.

DeepSeek is currently used in several Chinese Tesla rivals, including carmakers Zhejiang Geely Holding Group Co. and YD Co.

Representatives from Tesla and Bytedance did not respond to requests for comment.

The AI race for domination heats up

The scramble for Chinese buyers has meant that companies not based in the country, like BMW and Tesla, have had to find new ways to tempt drivers with more tech.

That has lead them to ink deals with local providers like DeepSeek and Alibaba, which has teamed up with BMW to offer its QWen large language model in cars. DeepSeek’s most recent AI model has also had market watchers sit up and take notice.

“While many recognize DeepSeek’s achievements, this represents just the beginning of China’s AI innovation wave,” Louis Liang, an AI sector investor with Ameba Capital, told Bloomberg. “We are witnessing the advent of AI mass adoption, this goes beyond national competition.”

AI fans may love this news

This may be good news for many AI enthusiasts who were wowed by DeepSeek’s release of its V3.1 model earlier this week, a debut which showed a surprising amount of power and range from the Chinese company compared to Western competitors.

“Deepseek v3.1 scores 71.6% on aider—non-reasoning SOTA,” tweeted AI researcher Andrew Christianson at the time, adding that it is “1% more than Claude Opus 4 while being 68 times cheaper.” That speed matched performance levels previously reserved for the most expensive proprietary systems, lifting DeepSeek into a whole new level of prestige.

Tesla cars in the U.S. currently use an AI model created by xAI dubbed Grok. Bloomberg theorizes that rolling out Grok in China has hit some legal hurdles abroad, which are likely a speed bump for CEO Elon Musk’s ambitions in the AI race.