Is Tesla Ready to Take On China?

on July 30 2013 | in Auto | by | with 1 Comment

Tesla, electric car, Tesla Motors,

Given demand for luxury automobiles is rising in China, it is not surprising that popular electric car company Tesla has targeted China as its next conquest.

Last year, about 19 million vehicles were sold in China, many from luxury automakers like Audi, BMW, and Mercedes. Telsa’s Model S is positioned to compete in the luxury segment of the market.

Electric cars can be very attractive in a country that continues to struggle with air pollution. The Model S will be a symbol of being wealthy but environmentally responsible.

“Chinese customers will buy the Tesla to show off their wealth and demonstrate their love of the environment. Tesla will be successful in China because they have already become a status symbol in the USA and that standing will translate to China, similar to the prestige of owning an iPhone,” said Charlie Paglee, CEO of Brannan Auto Engineering in Shanghai.

”China is the biggest auto market in the world, and that’s why Elon Musk is really pushing for sales in China,” said Mike Omotoso, senior manager of LMC Automotive.

Telsa announced plans to open its first showroom in mainland China at the end of the year. The showroom will be located at the Parkview Green mall, a certified LEED Platinum building in central Beijing. The 8,000 square foot showroom is much larger than its US showrooms and similar to the Rodeo Drive showroom.

Some industry analysts are not bullish on Telsa’s China prospects according to the Denver Post.  One of the concerns is that China is a sprawling country and there will not be enough charging stations. Another is the concern that Telsa’s intellectual property may get stolen. Then, there is price which could be very steep given the Model S will incur import and luxury taxes that could double the car’s already hefty sticker price. Currently, the Chinese government does not offer any incentives for imported electric automobiles.

The company will elaborate more on its China strategy soon. Marketing execution will be one of the key areas to watch if the company is to compete successfully in China.

image credit: tesla motors

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One Response to Is Tesla Ready to Take On China?

  1. Kablo Kanali says:

    ´´A good car to buy. The range is amazing and we are waiting for the low-cost model also… I would guess that no one would like to buy a gas car after using this…

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