I don't think they have the margins. They did the maths and it's not working out. This is supported by Elon coming out in January and saying that, unless regulators stepped in, Chinese EVs will eat everyone's lunch. Then in February the Reuters article suggests the project was put on the backburner indefinitely.
That's not what Elon said:
As a reminder, Tesla is, in part, a Chinese EV manufacturer with 50% of the US EV market. The warning may also be that importing a Tesla could become cheaper than domestic production. Electric Vehicle Sales and Market Share (US - Updated Monthly)Chinese car companies were the "most competitive" and "will have significant success outside of China, depending on what kind of tariffs or trade barriers are established," Musk said on a post-earnings call with analysts on Wednesday. "If there are no trade barriers established, they will pretty much demolish most other car companies in the world," he said. "They're extremely good." https://www.reuters.com/business/au...ish-rivals-without-trade-barriers-2024-01-25/