Tesla charged up for an electric performance in China

Electric car maker to ramp up charging infrastructure in its largest and fastest growing market

PUBLISHED : Sunday, 12 June, 2016, 7:58pm
UPDATED : Monday, 13 June, 2016, 2:56pm

Charging infrastructure will no longer be a hindrance for Tesla vehicle owners as the company plans to ramp up charging infrastructure in China, its largest and fastest growing market, according to a top official.

“I am quite happy to say that charging is no longer a roadblock for most of our [Tesla drivers] in China,” said Robin Ren, Tesla’s vice president for the Asia-Pacific region.

“Today you can drive all the way from Harbin, a city in the north, to Shenzhen which is located in the southernmost part of China with a Tesla car by using our supercharging network,” he said. There are currently about 100 supercharging stations in China, with about 400 superchargers in total.

Industry analysts said lack of charging infrastructure was the biggest impediment for Tesla’s continued growth in China.

Apart from the supercharger network, Ren said the company is working closely with utility companies on a plan that allows Tesla car owners to install electric chargers at homes and parking lots. The plan has achieved a success rate of 80 per cent, he said, adding that Tesla has installed over 1,400 destination chargers at shopping malls, office buildings and hotels. These units allow drivers to charge their vehicles while they are out and about at popular spots in the cities.

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Tesla has come a long way in China from when it first entered the market two years ago. At a technology conference in Beijing in April, Ren said China is now the company’s second largest market behind the US in terms of Model S orders. The Model 3 is Tesla’s affordable, mass-market electric vehicle with an estimated cost price of about US$35,000.

Tesla CEO Elon Musk said the company sold 1,345 Model S units in China during the third quarter of 2015, its strongest showing till date, while during the first nine months it sold 3,025 units. Musk had commented last year that China could catch up with the US market in five to six years.

Such feats are in stark contrast to Tesla’s performance in 2014. In April 2015, Musk was quoted as saying that China was the company’s only market to hold excess inventory as Tesla struggled in the Chinese market amid lukewarm demand for its Model S. The electric car maker later laid off some 30 per cent of its employees in China.

China second-largest market for Tesla’s Model 3 car

Ren attributed Tesla’s initial struggles in the China market to lack of brand recognition and understanding of the company’s technology.

“In bigger cities like Beijing and Shanghai, because of our stores and supercharger installations, people have … embraced the Tesla brand,” said Ren. “For a big market like China, it takes time to educate people about a new product.”

He added that government policies in China have been “very favourable” towards electric vehicles. Policies encouraging the shift to new energy vehicles include those in cities such as Hangzhou and Shanghai, which exempt electric vehicle owners from paying US$12,000 for a license plate. In Beijing, drivers who wish to purchase a Tesla vehicle can enter the separate license plate lottery for electric vehicles, where odds of winning are much higher than for petrol vehicles.

Additionally, Ren said that by replacing a larger percentage of internal combustion engine cars running on the street in China, there will be a positive effect in reducing smog. This is especially pertinent since between 25 to 40 per cent of smog is caused by cars on the road, according to Tesla.

“Our mission is to accelerate the world’s transition to sustainable energy, and we cannot do that without the biggest car market in the world,” said Ren.

This story was amended to correct a reference to the Model 3, Tesla’s affordable, mass-market electric vehicle, in paragraph six.