Tesla China Sales Will Spike With The Quick Rebound Of The Auto Industry

China's auto market is gradually recovering, as evidenced by sales growth. Sales of MIC Model 3 in March showed strong demand from Chinese consumers, which will intensify along with a rebound in the auto industry.

In Wuhan, a city with a population of 11 million, which was originally the center of the coronavirus and the first to be closed, the doors of car stores are gradually opening. Tesla also reopened its showroom in Wuhan on March 30th. According to Bloomberg, the power of unsatisfied demand took some car dealers by surprise, as daily sales have now reached the level seen before the economic freeze.

“I was pretty shocked,” said Zhang Jiaqi, a sales representative at an Audi AG dealer in the Wuchang district of Wuhan, which is now recording purchases matching year-earlier levels. “It’s like a boom after a two-month dormancy. I thought sales would be frozen. ”

Across China, the world’s biggest car market, vehicle sales have been picking up since early February, albeit from almost zero.

Source: Bloomberg

A marketing director at the Wuchang Audi dealership, noted that some customers look more motivated than before the crisis, because they believe that personal cars are safer than public transportation. At the Cadillac dealership, a sales representative said the number of visitors and the number of orders returned to the level before the stop.

Nationwide, the weekly retail car sales numbers have been improving for more than a month, after dropping as much as 96% during the crisis. In each of the first three weeks of March, declines moderated to 50%, 44% and 40%, respectively, according to the China Passenger Car Association, which said Thursday that nationwide sales for the whole of March were down 40% from a year earlier. The group predicted that weekly sales will rebound to last year’s levels by the end of April.

About 99% of China’s auto showrooms were back in business as of April 3, with consumer traffic running at about 66% of normal levels, according to the China Automobile Dealers Association.

In the first quarter of 2020, sales of electric cars in China, as well as around the world, continued to grow. One of the main roles in this was played by Tesla. According to CPCA in China, 2,620 cars from an American company were registered in January, about 3,900 in February, and 10,160 in March. According to CPCA, Teslas accounted for about 30% of battery electric car sales in China.

Tesla’s sales are facilitated by China’s policy, which aims to return the sales of NEV to the level that was before the outbreak of COVID-19, so they are ready to extend subsidies and tax exemption. China will help domestic manufacturers of electric vehicles, as well as those automakers who built car factories in China, and make cars for the domestic market. This undoubtedly applies to the electric vehicle manufacturer Tesla. Buyers of MIC Model 3s may qualify for subsidies and tax exemption.

This week, Tesla China officially announced 2 more China Made Models from Gigafactory Shanghai after the Standard Range Plus Model 3:

• Tesla Model 3 Long Range RWD, 339.050 RMB or equal to 48.170 USD (after subsidies);
• Model 3 Performance AWD, 419,800 RMB or equal to 59,643 USD (before subsidies); and
• Long Range RWD Model 3 with the range of 668 km.

The expansion of the assortment of automaker's models, government subsidies, and strong customer interest will certainly boost Tesla sales in China.

Featured image: CarSalesBase