07 Jan 2020
Tesla’s Model 3 vehicles will be arriving at Shanghai’s factory and made available to Chinese consumers on Tuesday. This takes place despite a minor decline in China’s electric vehicle market.
Chinese electronic vehicle firms are excited for Tesla’s latest model, as they are expecting the vehicle to help the sales numbers increase, boosting the production and sales of energy cars.
Around 1,000 Model 3 cars were produced every week at the Shanghai factory, which has only started production in October 2019. The firm is looking to up the production numbers to 3,000 in the coming time.
The Shanghai factory is Tesla’s first production space outside the U.S. The announcement of its opening was followed by a huge interest in EVs, and consumers were aided by government subsidies to purchases such vehicles.
Tesla will also be avoiding import tariffs that the U.S. imposed on China as part of the trade war.
Model 3 vehicles will be priced at more than 300,000 yuan, equivalent to $43,133 – marked as expensive by Bernstein.
It was said, “China(‘s Tesla) is obviously very focused on volume as opposed to margins, given its frequent price change to stimulate demand. Since locally sourced components are limited at this point and batteries are still imported from the U.S., the price cut to drive demand in China market will negatively impact (Tesla) profit.”
Tesla will also be facing competition from Nio, Xpeng Motors and WM Motor, amongst others. WM Motor’s CEO, Freeman Shen said, “I think it is a good thing for Tesla to be in China for local production. It will attract more potential buyers to look into EVs. Some of them will buy Tesla’s cars and some will buy WM’s cars. In EV market it is impossible that the winner will take all.”