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Gotion, Inc,, a wholly-owned overseas sun company of Guoxuan Hi-Tech, announced on Monday that it had signed an agreement with a large U.S. automaker to supply lithium iron phosphate batteries to it. Although Guoxuan did not disclose the identity of the customer, the outside world has speculated that the "large automobile manufacturing listed company" may be Tesla.
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In September, Tesla sold 56,006 cars made in China, breaking the previous monthly sales record of 44,264. But since then, sales growth has stagnated, with monthly sales actually slipping slightly in the first two months of the fourth quarter. Tesla sold 54,391 "Made in China" cars in October, down 2.9 percent from September, according to data released by the Association. In November, sales fell another 2.8 percent to 52,859 units.
You might think that this is just a small stain on Tesla's sparkling sales aura. After all, sales in November increased by 145% year-on-year. Since 2021, people have been able to see similar year-on-year growth every month. While this may seem clearly positive at first glance, the truth may not be that simple.
About the requirements
If you take a closer look at the sales figures, you'll quickly see that Tesla's sales growth in China since the beginning of 2021 has been largely driven by the Model Y SUV. As analyst and commentator CoverDrive explained last month, the Model Y's entry into the Chinese market coincided with a significantly declining sales trend for the Model 3 sedan.
Image source: Value Master Chinese Station
This raises the obvious question of whether China's demand for Tesla vehicles is sufficient to absorb the full output of the Shanghai plant.
In October, an estimated 40,666 Chinese-made Tesla vehicles were exported, setting a record and accounting for about 75 percent of total sales that month. In November, Tesla exported 21,127 vehicles, while the Chinese market digested 31,732 vehicles. When Tesla's German factory goes into operation next year, the demand of the European market will be met locally. That means Tesla will have to sell more cars in China or find other export destinations for its products from its Shanghai factory.
competitor
Tesla's sales in China fell for two consecutive months. Even more troubling is The December 8 report by Benzinga shows that sales of new energy vehicles (NEVs) in China are surging.
"China's overall wholesale volume of new energy passenger cars increased by 148.1% year-on-year to 429,000 units, an increase of 131.7% month-on-month and an increase of 18% over October. Most of them are battery electric vehicles, with a number of 343,000 units. NIO, Xiaopeng and Ideal All reported their November deliveries. All three companies delivered more than 10,000 electric vehicles — with Xiaopeng leading with 15,613, Ideal taking second with 13,485, and NIO selling 10,878. "
While local rivals accounted for most of China's new energy vehicle sales growth, global automakers also got a piece of the pie. Volkswagen, for example, set a new monthly record for sales of its iD series in November, delivering 14,100 new energy vehicles, up 10.7 percent from October. While Volkswagen's sales of electric vehicles in China still lag far behind Tesla's, Volkswagen is clearly fighting for a higher share of the market share of New Energy Vehicles in China. In the European market, Volkswagen has surpassed Tesla as the largest seller of electric vehicles in the region, and it has every reason to believe that it can also occupy an important position in the Chinese market.
It is undeniable that Tesla's position in the Chinese market will not be easily shaken in the short term. But Tesla's sales in China, especially the long-term development of the Chinese electric vehicle market, are still worth paying attention to, especially after Tesla's German factory is put into production.
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