As Tesla Inc grapples with a global slowdown in electric vehicle (EV) demand that contributed to its largest-ever quarterly sales miss, the automaker is also steadily losing ground in China — the world’s biggest automotive market.
Confronted with unprecedented local competition amid weakened consumer sentiment in Asia’s largest economy, Tesla’s market share shrunk from 10.5 percent in the first quarter of last year to about 6.7 percent for the fourth quarter, China’s Passenger Car Association (PCA) data showed.
The association’s figures for the first two months of this year showed that Tesla’s market share for the period was about 6.6 percent, compared with 7.9 percent in the same period a year earlier, when COVID-19 restrictions were just lifted.
Photo: EPA-EFE
Tesla, which has long labeled itself a transformer in the industry with avant-garde products and cutting-edge technologies, has, in China at least, been relying upon two models — the Model 3 sedan and the Model Y sport utility vehicle. Both were first unveiled before 2020 and have only had minor refreshes since.
Meanwhile, a slew of rivals, from BYD Co (比亞迪) to Nio Inc (蔚來), Xpeng Inc (小鵬), Li Auto Inc (理想) and now smartphone maker Xiaomi Corp (小米), have unveiled new line-ups packed with high-tech features.
Price cuts used to be another sales booster for Tesla, a strategy that allows it to dictate the end price in line with production costs and market demand.
However, Chinese automakers have proven to be determined to join the price war, which was started by Tesla in January last year and repeated at the start of this year.
Many of them actually deepened their price cuts earlier this week, a likely response to Tesla’s pre-announced price hike on Monday.
As is the case in many places around the world, growth in China’s EV market is slowing.
Shipments of new-energy vehicles are projected to increase 25 percent to 11 million units this year, the association has said.
While still expanding, that is down from 36 percent last year and 96 percent in 2022.
The association on Tuesday said that Tesla delivered an estimated 89,064 vehicles in China last month, up from 60,365 in February — which was the lowest since December 2022 — and broadly in line with 88,869 in March last year.
Globally, Tesla said it delivered 386,810 vehicles in the first three months of the year, down 8.5 percent year-on-year and missing Bloomberg’s average estimate by the biggest margin ever in data going back seven years.
“It’s been an epic disaster, not just in terms of the delivery number, but the strategy,” Wedbush Securities Inc analyst Dan Ives said yesterday in an interview with Bloomberg TV in Asia. “This is probably one of the most challenging periods for [Tesla chief executive officer Elon] Musk and Tesla in the last four or five years.”
Comments will be moderated. Keep comments relevant to the article. Remarks containing abusive and obscene language, personal attacks of any kind or promotion will be removed and the user banned. Final decision will be at the discretion of the Taipei Times.
