China's Champions

by Gill D on September 18, 2020

Tesla’s Weibo account has confirmed that Tesla has hit the number one spot as Hong Kong’s most popular brand of car. According to Hong Kong’s Transportation Department, it receive 912 new Tesla vehicle registrations in August 2020. Over and above that, the Model 3 has become the highest selling passenger vehicle in the region. This news comes just one year after Hong Kong first delivered the Model 3 to the local market.

With an annual production at 250,000 at the Shanghai Gigafactory, it shouldn’t be too much of a surprise at how Tesla is winning the hearts of the Chinese. Tesla CEO, Elon Musk also approached the foreign market with a clever marketing strategy. Elon’s eyes could see the potential in the region, which has the biggest automotive presence in the world, hitting 258 million cars by the end of 2019. Considering the country alone has 1.3 billion people, there’s clearly a lot of potential customers to target. With focus on the penetrating the large-scale market, Tesla started offering variants of the Model 3 with reduced prices on the Standard Range+ so the car could be eligible for government incentives and enhance its appeal to consumers.

For Giga Shanghai to start production of the Model Y, Tesla started expanding the EV facility, calling it Phase 2A. Construction has gone at a rapid pace and should be nearing completion anytime soon. And once that part of the factory comes online, Tesla will have the new assembly line pushing out the Model Y. The Tesla fan base is increasing in China, so we could see a lot more sales activity picking up in the future. Electric vehicles are becoming sought after, especially in highly populated countries like China that are blanketed in pollution and noisy traffic.

Tesla can also put another feather in its cap by surpassing local EV makers like Nio. As all Tesla owners know, there is something quite special about the US-based car and its design, which is why it’s outdoing every other auto manufacturer that dares compete.

Shanghai Gigafactory is also going to be shipping cars to other parts of Asia, Australia, and New Zealand. It will significantly reduce shipping costs and customers won’t have to wait for their car to sail halfway around the world. Currently, the Aussies and Kiwis who order Teslas, get their vehicles from the Fremont facility in California. Shifting the source to China could open up a whole new market for regional orders.

If Giga Shanghai is doing so well in productivity and sales, it only bodes well for the next Gigafactory in Berlin. Perfectly situated to serve the whole of Europe, Giga Berlin will possibly enjoy the same results as its sister factory. All the gigafactories are perfectly situated to serve all parts of the world.

Talking about Germany… BMW seems to be taking a page out of Tesla’s book as the German auto manufacturer will be moving a portion of its EV production to China as well for the upcoming iX3 SUV. Another carmaker jumped on the bandwagon too with Volkswagen injecting a US$2billion investment into its EV production facilities in China earlier this year via its tie-up with local manufacturer JAC.

Elon Musk and Tesla have the pace and direction of the EV industry. The auto manufacturers of the world are finally taking electric vehicle revolution seriously. Companies are gearing up to adopt the switch from petrol to electricity and the significant investments being made show they realize it’s time to ramp up their pace to catch up to Tesla.

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