Tesla suffers setback in China as backlash over safety, quality of its electric cars sinks sales by 27 per cent
- The decline of nearly 10,000 vehicles in April is a ‘huge setback’, said Gao Shen, an independent analyst in Shanghai
- A protest at the Shanghai Auto Show by the owner of a Model 3 that had crashed sparked a social media storm over quality standards at Tesla’s Gigafactory 3
Tesla’s sales in mainland China hit a blip last month as the leader in the electric vehicle (EV) field ran foul of angry customers raising concerns about safety and quality.
Tesla faced a social media backlash from Chinese customers last month over safety and quality issues.
It has also released the data log of the car, which crashed in February this year in Zhengzhou, the capital of China’s central Henan province, to the woman. According to local media reports, she and Tesla had been arguing for months about whether the car in question was speeding and if its brakes failed.
Tesla’s run-in with owners and regulators about the safety of cars assembled at its Gigafactory 3 in Shanghai had deterred motorists from buying both its Model 3 and Model Y vehicles, Gao said.
A price increase for the Model Y, announced by Tesla in March, would also have dented sales.
The carmaker raised the prices of its made-in-China Model Y sport-utility vehicles (SUVs) by 8,000 yuan (US$1,245) in late March, which suggested it was comfortable with the sales of the car, according to David Zhang, an analyst at the North China University of Technology.
Tesla raised the price of Model Y’s Long Range version to 347,900 yuan, just three months after it launched the SUVs on the mainland.
The Shanghai Gigafactory 3 also exported 14,174 vehicles in March, according to the CPCA.
“Other new-energy vehicle assemblers in China are also actively making preparations for overseas expansions,” said Cui Dongshu, secretary general of the CPCA.
Reuters reported on Tuesday that Tesla had halted plans to buy a piece of land to expand its Shanghai plant and make it a global export hub, because of uncertainty created by US-China tensions.
With 25 per cent tariffs on imported Chinese electric vehicles imposed on top of existing levies under former President Donald Trump still in place, Tesla now intends to limit the proportion of China output in its global production, it said.