SHANGHAI, July 4 (Reuters) - Tesla's

best-selling Model Y was included in a list of electric and

plug-in hybrid models that a local government in China can

purchase as a service car, according to the official Chinese

media outlet the Paper on Thursday.

It was the first time Tesla's cars have been made eligible

for government purchases in China, the Paper added.

China's eastern Jiangsu provincial government published 56

batches of new energy vehicle procurements for use as service

cars by party, government and public organisations in a

government statement on June 6.

Apart from the Model Y made in Tesla's Shanghai factory and

Volvo Cars' XC40, the other 54 batches were all Chinese-branded

EVs and hybrids. Volvo Cars is owned by Chinese automaker

Zhejiang Geely Holding Group.

Neither the government nor the Chinese media specified the

number of Model Y cars that the Jiangsu provincial government

could buy.

Tesla's cars were banned from entering some government and

military compounds in China.

The restrictions were removed after it won an endorsement

from the country's top auto industry association that said in

April the data collection by Tesla fleets in China was

compliant.

As demand for Chinese cars abroad is overshadowed by the

prospect of tariffs and domestic competition intensifies,

Tesla's deliveries of China-made vehicles fell 9% in the first

half compared to the same time in 2023.

Tesla CEO Elon Musk's trip to China in late April to meet

Premier Li Qiang, however, appears to have paid off.

China has increased its support for Tesla, which plans to

build a data training centre and roll out its Full Self Driving

software in the country this year, despite ongoing tensions with

the United States over tech rivalry.