Tesla in China is a Win-Win Situation
By entering the world's largest economy, Tesla could increase its global brand considerably while aiding China with one of its most pressing problems: air pollution.
Last week, it was put forth by Quartz that completion of the Gigafactory would mean that 90 percent of every Tesla vehicle made will be manufactured from American-sourced parts. Today, Bloomberg reports that Elon Musk intends to take his growing empire on the road by not only beginning deliveries in China, but also manufacturing cars within the country “in the next three to four years.” By introducing their product in the world’s largest economy and most active car buying market, introducing Tesla in China could be the next push on the path to the automaker’s quest for total legitimatacy/domination.
At yesterday’s Geekpark conference in Beijing, Tesla’s CEO also stated that they will be creating a vast battery-charging infrastructure within the country, which includes superchargers in both Beijing and Shanghai. Further, he stated that he intends to invest hundreds of millions of dollars in the country. Let’s just hope that China’s politicians aren’t also getting their pockets greased by car dealers.
Tesla in China is beneficial to pretty much everyone involved. Not only will Musk be able to potentially double the number of cars he sells on an annual basis, but local production will also circumvent the 25-percent import tariff imposed on foreign vehicles. The Model S is expected to sell for around 734,000 yuan ($118,000 USD), but Musk wants to qualify for China’s electric car subsidies in order to offset the costs associated with shipping, value-added taxes, and import duties.
Further, Tesla in China might serve to help interest the country at last in making the switch to electric vehicles. Better infrastructure and sportier models would certainly be enticing to those wealthy Chinese citizens who cling to their gasoline-and-diesel-powered cars and could ultimately help reduce air pollution in a country that emits more CO2 than any other in the world.
Popularizing EVs in China could go a long way toward completing China’s State Council’s national plan to decrease fine particulate matter in the air by 2017. Tesla hitting it big in a market where 21.98 million cars could sell this year alone may well jettison the brand into automotive supremacy.