Tesla surpasses $1 billion in sales in China, tripling last year’s revenue

Tesla continues to monitor and adapt to developments taking place through China’s National Energy Administration as the California-based electric car maker aims to become an integral part of China’s 13th Five-Year Plan (2016-2020). A significant component of the energy goals for that five year span includes movement toward a larger percentage of electric vehicles (EVs) on China’s roads.

What’s the news from Tesla China?

• Revenue from Tesla China amounts to $1 billion, according to the company’s latest 10-K SEC Filing.
• In February, 2017, the State Council of the People’s Republic of China announced it will build 800,000 charging points by early 2018.
• 100,000 of the anticipated charging points are expected to be public access, or 250,000 public charging points total.
• China will quadruple its new EV annual output to 2 million by 2020.
• China has a goal of 5 million EVs on the roads by 2020.
• China has expressed interest in converting its Beijing taxi fleet to EVs.

How has Tesla China evolved?

• Tesla China launched in 2014.
• Slow deliveries and fewer-than-need chargers dampened early Chinese EV consumer enthusiasm.
• Tesla introduced a converter so its Tesla owners could use government-run charging points.
• Problem-solving within Tesla China included a 2015 philosophical shift that incorporated new strategic options consistent with Chinese business practices.
• One way Tesla attempted to meet Chinese consumer demands was through introduction of optional premium rear seats for those who had a personal chauffeur.

Challenges ahead for Tesla China

• Although China is comparable in size to the U.S., it has, overall, fewer Superchargers.
• The 114 Tesla supercharger stations in China amount to only 14% of all global Supercharger stations, which is important because Tesla Superchargers provide added value when a Chinese consumer decides which EV to purchase.
• Many Chinese EVs have shorter ranges but are also much less expensive.

Tesla is about to take advantage of the China’s electric car revolution

Holding an important position in the world’s biggest automotive market isn’t quite enough for Tesla. The all-electric vehicle company is keenly aware that, in 2016, top Chinese electric carmakers BYD, Geely, and BAIC sold their models in more than 30 countries and regions around the world. Tesla has not yet become top EV choice in China, but, knowing the company’s ability to penetrate markets around the world, Tesla China’s next steps should be fascinating to watch.

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