Sandalwood Research Blog
Are Tesla’s China sales slowing down?
Tesla recently announced their intent to manufacture vehicles in Shanghai, riding China’s potential as a huge market for electric vehicles. While still a relatively small portion of Tesla sales overall, it’s worth noting that Tesla’s China sales tripled from 2015 to 2016, to hit the $1 billion mark.
But while Tesla’s visibility as a brand has made its China ambitions well-publicized (and some would say well-hyped), China hasn’t escaped the notice of traditional automakers. Industry stalwarts such as Volkswagen are eyeing China as a target market for their EV push, and domestic Chinese competition like BYD aren’t waiting in the wings either. Tesla’s competition is also growing worldwide with all of the traditional automakers aggressively pushing forward with their EV strategies, with Volvo going as far as to say that all models it introduces starting in 2019 will be either hybrids or fully electric.
A recent WSJ report noted a slowdown in Tesla’s Hong Kong sales, as a generous tax break for electric vehicles was eliminated on April 1. Amid rumors that Tesla sales are slowing down worldwide, we decided to dig into what our data was saying about Tesla’s actual performance in mainland China. Our data accurately predicted Tesla’s mainland China sales for 2016, so here’s a look at how Tesla is doing through the first six months of 2017:
While we’ve omitted the hard numbers in this teaser chart to protect our clients, one thing is clear: Tesla’s year-over-year growth rate in mainland China is the slowest its been in recent history. Our data tracks both car purchases as well as deposits, indicating that Model 3 reservations aren’t increasing as the release date nears. It is worth noting that TSLA experienced very strong growth in June 2016, resulting in a tough comparison for June 2017. Could this just be a temporary slowdown in year-over-year growth? Or is Tesla preparing to charge ahead at Ludicrous mode? For near real-time tracking of TSLA’s China performance, contact us using the link below.
For more information about Tesla’s performance in China, along with our specific methodology, please contact us here.