Canadian national pleads guilty to stealing Tesla trade secrets

Cars are parked at a Tesla dealership in Berlin Tuesday, April 23, 2024. (Sebastian Christoph Gollnow / dpa via AP)

A Canadian resident of China pleaded guilty in New York federal court on Thursday to stealing Tesla electric-vehicle battery manufacturing trade secrets and conspiring to sell them to undercover government agents, according to the U.S. Department of Justice (DOJ).

Klaus Pflugbeil, 58, the operator of a China-based business that sells technology used in electric vehicles, faces up to 10 years in prison for plotting with business partner Yilong Shao to sell Tesla's secrets to FBI agents posing as Long Island businesspeople, the department said in a statement.

Neither Pflugbeil's attorney nor representatives for Tesla immediately responded to Reuters requests for comment. Shao, who was also charged but remains at large, could not be reached for comment.

"With his guilty plea, Pflugbeil is now being held accountable for this unlawful conduct that jeopardized our national security," U.S. Assistant Attorney General Matthew Olsen said in a statement.

Pflugbeil, who is also a citizen of Germany, was charged in New York in March. Prosecutors said Pflugbeil and Shao built their EV battery business on trade secrets from a "leading U.S.-based electric vehicle company."

Prosecutors did not name the company but said it acquired a Canada-based manufacturer of battery-assembly lines in 2019, which matches the description of Tesla's acquisition of Canadian company Hibar.

Thursday's statement said that Pflugbeil and Shao both worked for the Canadian company before Pflugbeil joined Shao's business in 2020. DOJ said that the unnamed business now has locations in China, Canada, Germany and Brazil, making the same battery-assembly equipment as their previous employer.

(Reporting by Blake Brittain in Washington; Editing by Alexia Garamfalvi and Sandra Maler)