If the Tesla Model Y is the second best-selling car in China in November, it seems that the brand is experiencing some difficulties. Sales fell despite the drop in prices and the drop in production speed at the factory in Shanghai, what happens to the manufacturer in the Middle Kingdom?
No more for Tesla. If the company seems to be doing quite well in Europe, while the Model Y was the best-selling electric car in the old continent last November, it is not really the same in China. The manufacturer actually seems to be going through a real crisis in the country, while demand and sales plummet. The company is said to be planning to slow production at its Shanghai plant, which churned out more than 80,000 cars last September.
For a few weeks, the situation seems to be difficult for Tesla in China. While his factory is running at full speed, customers don’t seem to be rushing to the gate to buy them. So much so that the brand, currently based in Austin, Texas, has a huge surplus of Model Y and Model 3 inventory. Thousands of cars would then not have found a buyer, a situation that costs money for the brand, which manages stock and logistics itself.
And yet it is not for want of multiplying operations of seduction. Last October, the manufacturer announced the return of its sponsorship program in China to encourage customers to talk about Tesla around them in exchange for rewards. A few weeks later, the company also decided to sell off its Model Y and Model 3, again to boost sales.
But nothing seems to help. However and as the site explains Teslaratithe compact SUV is was it second best selling vehicle in China in November, just behind the BYD Song DM-i. On the other hand, the Model 3 is struggling to find customers, placing itself in 45th place in the same ranking. However, according to BloombergTesla broke its production record in China, with more than 100,291 cars leave its factory.
But now the brand also has to face increasingly tough competition, especially from Chinese brands such as BYD and GAC. The first one is actually sold more than 230,000 cars in November, including 114,000 that are 100% electric. What worries the company Elon Musk, who could be a little too greedy and produce more cars than it sells.
A decrease in activity
Elon Musk wants the brand to speed up its production rate even more. But the problem is that it fails to sell its already manufactured cars. So much so that Tesla would have made the decision to reduce rotation time (shift) of its employeesas the site explains Car news. In addition, the brand has also decided to suspend employment at his factory from Shanghai.
At the same time, and again according to information from Bloomberg, the company plans to cut production by 20% at its Chinese assembly site. Nevertheless, only the Model Y would be affected, but according to a specialist quoted by Teslarati, it would have nothing to do with a drop in sales. In fact, this decision will be mainly linked to the production of the SUV in the Gigafactory in Berlin.
If the copies delivered in Europe until then were produced in China, the acceleration of the speed on the German site makes it possible to reduce the speed from the Shanghai factory for this model in particular. According to information from Reutershowever, these rumors would have been dismissed by Tesla, without the company providing further details.
Despite the difficulties, however, it shows very good overall sales figures, while it can cross the milestone of one million cars delivered by the end of the year worldwide.
A global situation
Nevertheless, Tesla is not the only brand experiencing difficulties in China, a special and highly protectionist market. In fact, and unlike Europe, which could go from exporter status to importer status in 2025, the Middle Kingdom has a strong appetite for models from local manufacturers.
A situation that therefore undermines foreign producers, who then find it difficult to attract customers. So much so that Mercedes has also lowered the prices of its EQE and EQS in China, while Jeep has decided to withdraw from the market. As explained Reutersthe American brand, owned by Stellantis, has indeed decided to terminate its joint venture with GAC.
However, in addition to the priority given by buyers to Chinese vehicles, the health crisis and the zero-Covid strategy introduced by the government also has a detrimental effect on the market. According to an article by Capital, sales fell by 9.2% last November. Opposite to, exports increased by 56% in the same period compared to last year. Many vehicles then go to Europe, while 20% of cars sold here are made in China.
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