Tesla Motors Inc. (NASDAQ:TSLA) seems to have developed another way to make its mark in the Chinese automobile market. Tesla unveiled its electric vehicles in China to much fanfare last year. In fact, CEO Elon Musk was treated like a pop star and the optimism was high that Tesla will hit it big in China. One year later, Tesla is still struggling to establish itself in China but Elon Musk is not throwing the towel yet.
When Tesla launched in China, the firm expected Chinese sales to account for 35% of its 2014 global sales. This lofty hope made sense because China is the fastest growing auto market in the world. More than 22 million cars were sold in China in 2013 to account for more than 25% of cars sold globally.
However, Tesla was unable to take a decent portion of the auto sales in China last year. Sales reports show that Tesla sold about 3,500 cars in China well below 35% of global sales. More so, Tesla’s sales was nothing compared to the sales of Chinese makers of electric vehicle such as BYD and BAIC.
Some of the reasons for Tesla’s lack of sales in China include anxiety problems about charging infrastructure. Other problems include a small pool of early adopters and cultural issues about the size of the cars.
Innovative Charging Solutions For Tesla’s Chinese Rebirth
Zhou Tian of Caixin Online reports that Tesla is taking a serious of steps that will aid its rebirth in China. Tom Zhu Xiatong, Tesla’s new executive in charge of operations in China provided some insight into the firm’s plan.
Anxiety about charging points has been is one of the reasons Tesla isn’t selling many cars in China. The more than 20,000 charging points in the country are designed to only work with EVs produced in China. Now, Tesla is working on making its cars compatible with Chinese charging infrastructure. Tesla currently has 40 superchargers and 600 smaller charging stations in China.
The anxiety surrounding charging issues might not have been serious if Chinese buyers had access to in-home charging systems. Tesla offers buyers in-home chargers but most buyers are unable to use them because they don’t have private garages. The administrators in charge of most apartment complexes consider those in-home chargers a fire hazard, and they don’t allow them to be installed in their garages.
In addition, Tesla is working with banks and telecom operators to install charging stations at banks and retail outlets in the country. When the deals are finalized, drivers of Tesla’s cars will be able to charge up their cars in the time it takes them to complete a financial transaction in a bank or recharge call credits on their phones.