Tesla is crushed in China, the most important market outside the United States and one that had dominated it for years.
When Liu Jie, 32, decided to buy an electric car in October, Tesla was one of her top choices. But after testing a few Chinese cars, she went with a Sportsedan from Xiaomi, a gadget maker of consumers, better known for its smartphones, boilers and robotoffacumums.
“Xiaomi is more fashionable,” said Mrs. Liu last week in Beijing. 'Tesla, it is a bit normal for me. You can see the Tesla model Y everywhere. “
It is not personal, buyers said. Tesla is still considered a top brand, and Elon Musk, Chief Executive of Tesla, is admired in China. Beijing rolled out the red carpet when he broke ground on the first overseas factory of the company in Shanghai. Mr. Musk is credited for igniting the local electric vehicle industry of China.
But now that market is a massacre of competition from Chinese rivals. Chinese drivers who once flowed to Tesla are increasingly changing local brands that offer more efficient cars with better technology, sometimes at half the price.
Tesla's largest rival, the electric car giant BYD, sold 481,318 cars in the first two months of this year, more than three -quarters more than in the same period last year. Tesla sold 60,480 vehicles in the first two months of the year, a decrease of 14 percent compared to last year.
The sale of Tesla in China is falling while the car manufacturer is confronted with criticism of Mr. Musk's role as an assistant for President Trump who is responsible for reducing federal expenses. Tesla lost around a quarter of its value last month when investors scoured the share.
The threat that BYD Tesla poses in China has been building up for years. BYD has sold around a million more cars in the last three years. The popularity of BYD is partly driven by the fact that the cars are cheaper. It helped that local authorities sometimes send things in the direction of the company.
But a real estate crisis and a broadly delaying consumer economy have affected households and the appetite of people to shop, making it difficult for all car manufacturers. Things have become so bad that the government started offering subsidies for consumers a year ago to act in their old cars. The government increased the stimuli last week. Domestic companies have benefited from the subsidies, but that also applies to Tesla.
Even in the midst of the economic delay, there is still a market for luxury cars, for those who can afford it. Mrs. Liu, who had a budget of around $ 41,000, said that Tesla would have been an affordable luxury option compared to the $ 41,305 Xiaomi Su7 Max that she bought. And while Tesla offers a five-year-old zero-interest loan, Xiaomi does not offer financing.
Many Chinese drivers are also willing to pay more for advanced technology such as self -driving, an area in which Tesla has been left behind because the government has delayed the introduction of similar or better technology by the company.
But Tesla is confronted with another problem: question. The sale slows down for all cars in China.
The policy that is aimed at replacing gas guzzers through electric vehicles. In cities such as Shanghai and Beijing, car owners can trade in older cars for a new one and a subsidy of almost $ 2,100. In some Tesla dealers, employees have made a wall with photos of the cars that buyers have traded in – they vary from Porsches to Mercedeses and even occasionally a Chinese car.
But acting in an old car for a new one is usually a one -off thing.
For many dealers it becomes more difficult to sell every car. “It was ok two years ago, but now the market is saturated,” said Chen Jiaming, a seller at a FAW-Volkswagen dealer in Shanghai, a collaboration between the Volkswagen Group with the state company FAW Group.
Mr. Chen works from the “new energy vehicle block”, in the basement of a shopping center near the Zhongshan park in Shanghai, which was converted from a food court three years ago when electric vehicles first left in China.
Some of the only dozen dealers in the basement of the shopping center have already left, the lights inside were eliminated on a recent weekday. A row of claw machines illuminated another empty space. To prevent the FAW-VW dealer from being closed, the shopping center gave the seven-month free rent, Mr. Chen said.
“I think Tesla's competitiveness in China will only take the next two or three years,” said Mr. Chen, who owns a BYD. Tesla's driving technology is no longer advanced compared to local rivals, he added.
After years of lobbying at the government, Tesla was finally allowed to offer a version of his autopilot technology to Chinese drivers last month. The function is a step below the full self-driving function that Tesla steering programs can use in the United States. Drivers who want access to the necessary software update in China, have to pay $ 8,800 extra.
Younger buyers prefer Chinese brands, said Xia Lifang, an employee who works at the nearby dealer for Arcfox, a Chinese electric car manufacturer. Tesla and BYD remain the most familiar brands in China, she said, but people born in the nineties and 2000 are more open to trying new brands.
“Our car looks better than Tesla,” said Mrs. Xia with a smile.
She added: “You could buy two of our cars for the price of one Tesla.”
Li you contributed research.
