( 4 images )<\/span><\/figcaption>Tesla started production at its Shanghai factory in late 2019. It has boosted sourcing of cheaper local components, including batteries from China\u2019s CATL and LG\u2019s Chinese factory.<\/p>\n
\u201cIt wasn\u2019t so long ago that the group was trimming prices in the U.S. to gain scale and maximize profitability, and it feels like we\u2019re now seeing that in China too,\u201d Hargreaves Lansdown analyst Nicholas Hyett said.<\/p>\n
The low cost of producing local EVs in China would have a lasting effect for Tesla, said Gene Munster at Loup Ventures.<\/p>\n
\u201cTeslas are on average 3x the cost of a typical EV made in China. So they have to be priced less than the US to compete,\u201d Munster said. \u201cPrices of Teslas in China will be below rest of the world for the next decade.\u201d<\/p>\n
Tesla also cut costs and boosted margins in the U.S. market by getting rid of some parts like a radar sensor and lumbar support.<\/p>\n
CHINA MARKET SHARE SLIPS<\/h2>\n
In China, Tesla\u2019s share slipped to 11% in the battery electric vehicle market, which excludes plug-in hybrid cars, in the second quarter from 18% a year earlier, according to GLJ research. But data from Morgan Stanley showed Tesla still held a U.S. battery electric market share of nearly 70% as of February, although that was down from 81% a year earlier.<\/p>\n
China accounts for 44% of the global EV market, a much bigger share than the 17% held by the United States.<\/p>\n
In China, Tesla faces competition from electric vehicle makers like Nio Inc and Xpeng Inc. In the United States, Tesla\u2019s brand is stronger and its main rivals are legacy automakers like Ford and General Motors, which generate only a fraction of their sales from EVs.<\/p>\n
GLOBAL CHIP SHORTAGE<\/h2>\n
Tesla CEO Elon Musk has reiterated that the company\u2019s mission is to make electric cars affordable, and has blamed vehicle price increases on a shortage of chips and raw materials.<\/p>\n
Tesla is coping with the chip shortage by using alternative chips and rewriting software, Musk said.<\/p>\n
He provided a cautious outlook for chip shortage. \u201cIt does seem like it\u2019s getting better,\u201d he said on the second-quarter earnings call, but added: \u201cit\u2019s hard to predict.\u201d<\/p>\n
($1 = 6.5104 Chinese yuan renminbi)<\/p>\n
(Graphics: Prices of Tesla models in China: )<\/p>\n
(Graphics: Prices of Tesla models in the U.S.: )<\/p>\n
Source: Read Full Article<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"
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