Monitoring Desk
ISLAMABAD/SHANGHAI: Slashed prices give Tesla’s China sales the pop, but analysts warn the United States automaker needs to up its long-term game to avoid choking on dust of fast-moving rivals in the most prominent international electric vehicle market.
Analysts said that the most immediately, Tesla’s January price cuts drove deliveries of its China-made vehicles up 18 percent from December. Tesla’s thick profit margins put it in a position to take the price war with competitors in China and beyond.
Tesla stance
But they say Tesla lagged competitors in China in introducing fresh models, improving navigation systems and adding luxe interior touches and white-glove customer service to serve the developing range of consumer preferences for EVs.
Cui Dongshu said that “tesla’s facing a serious problem of a limited product mix,” China Passenger Car Association secretary general said. “Its slowness to respond to Chinese consumers’ preferences has led to a very impressive positioning for Tesla to rely on few means such as price cuts to stay competitive.”
Even Tesla Chief Executive Elon Musk himself conceded that China was where his firm could face its toughest competition.
Tesla didn’t respond to Reuters’ request for comments on its China business. Grace Tao, Tesla’s vice president head of external communications in China, said the last price cuts in China reflected engineering innovation and answered Beijing’s call to encourage economic development.
