China Resident Pleads Guilty to Stealing Tesla Trade Secrets

Facts

• Klaus Pflugbeil, a dual Canadian-German national who resides in China, has pleaded guilty in New York federal court for stealing Tesla electric vehicle (EV) battery manufacturing trade secrets.¹
• This comes as he was arrested on March 19 in Long Island, N.Y., for sending trade secrets to an undercover federal law enforcement agent posing as a businessman. A few days later, Pflugbeil was released on a $1M bail.²
• Scheduled to be sentenced in October, he will face up to 10 years in jail for conspiring to sell top-secret information to speed up battery production, which he had access to while working for a Canadian battery manufacturer bought by Tesla.³
• Though no company is explicitly mentioned in the announcement from the US Department of Justice, the description of the companies confirms that 'Victim Company-1' is Tesla and the Canadian manufacturer is Hibar Systems.⁴
• Pflugbeil and his co-defendant, Yilong Shao, whose whereabouts are unknown, are accused of 'misappropriat[ing] intellectual property belonging to American companies' for their own business activities.⁵
• They allegedly set up a business in China in mid-2020 to sell products developed with stolen trade secrets, marketing their company as an alternative source for the battery assembly lines and expanding operations to Brazil, Canada, and Germany.⁶

Sources: ¹Reuters, ²CTVNews, ³Fortune, ⁴TESLARATI, ⁵United States Department of Justice and ⁶Associated Press.

Narratives

• Anti-China narrative, as provided by Townhall. By pleading guilty to this espionage conspiracy, Pflugbeil has exposed that Beijing is deliberately working against the US. After all, it's no coincidence that, yet again, an individual linked to the Chinese Communist Party has threatened America's economic interests and national security.
• Pro-China narrative, as provided by XINHUA. That this case would prompt another round of smears against China is no surprise, but that doesn't make it less outrageous. Intellectual property protection in key areas, including to safeguard trade secrets, has been strengthened in the country — and Pflugbeil isn't even a Chinese national.

Predictions