On 6th January 2023, Tesla China announced significant price cuts across its lineup. The price of Model 3 was slashed by 20,000 – 36,000 yuan ($3,000 – $5,300) for a new retail price of 229,900 yuan – 329,900 yuan ($33,600 – $48,200). The Model Y price was lowered by 29,000 – 48,000 yuan ($4,200 – $7,000) to a final price of 259,900 – 359,900 yuan ($38,000 – $52,600), hitting a record low.
This caused anger among Chinese customers who had just picked up the new car as they paid the old, higher price. For instance, the price of the Tesla Model 3 used to be 30% higher than the BYD Seal electric sedan, but now the prices are almost the same. Videos posted on social media showed crowds at Tesla stores and delivery centers in other Chinese cities from Chengdu to Shenzhen, suggesting wider consumer backlash.
Protest at a Tesla store in China
While several protests in front of Tesla Stores occurred around China, in Taikoo Li, a shopping center in Chengdu, things got much more intense where the angry customers got inside the store, vandalized it, damaged the electric Cyberquad ATV, and stole various gifts and snacks as per reports.
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The angry crowd of Tesla owners reportedly formulated their demands, signed the document with fingerprints, and handed it to the Tesla staff. The demands include 100,000 km of free supercharging, 10 million Tesla points, lifetime FSD access, and 2-4 years of extended warranty.
Other protests occurred in front of various Tesla dealerships across China. One of them took place in front of Tesla’s shop in Xiaoshan, Hangzhou – southwest of Shanghai. People gathered outside the Tesla store and shouted ‘refund.’ One of the customers put a sign saying ‘rights protection’ on Tesla in front of the dealership.
In front of another Tesla store, customers showed a banner with “Buy now! But how do you know there won’t be a price drop next month?” written on it.
One video, which was reportedly filmed at a Tesla store in the southwestern city of Chengdu, showed a crowd chanting, “Return the money, refund our cars.” Another Tesla owner named Zhang protesting at the company’s delivery center in Shanghai’s Minhang suburb said he & other Tesla owners were frustrated with the abruptness of Friday’s price cut and Tesla’s lack of an explanation to recent buyers.
Zhang commented, “It may be a normal business practice but this is not how a responsible enterprise should behave.” He and the other Tesla owners, who said they had taken delivery in the final months of 2022, said they were frustrated with the abruptness of Friday’s price cut and Tesla’s lack of an explanation to recent buyers.
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Analysts have said Tesla’s move was likely to boost its sales, which tumbled in late 2022 and forced other EV makers to cut prices too at a time of faltering demand in the world’s largest market for battery-powered cars. In addition to Tesla, Mercedes also announced substantial price cuts towards the end of the year 2022.
China accounted for about a third of Tesla’s global sales in 2021 and its Shanghai factory, which employs about 20,000 workers, is its single most productive and profitable plant. Analysts have been positive about the potential for Tesla’s price cuts to drive sales growth at a time when it is a year from announcing its next new vehicle, the Cybertruck. Bill Russo, head of consultancy Automobility Ltd in Shanghai, says:
“Nowhere else in the world is Tesla faced with the kind of competitors that they have here [in China]. They are in a much bigger EV market with companies that can price more aggressively than they can, until now.”
The road isn’t that easy for Tesla in China. In March 2020, Chinese customers complained that they were getting inferior cars from Tesla after which the Chinese government stepped in, and urged Tesla to keep its China-made vehicles consistent. Later on in another event, a Chinese court ordered Tesla to refund the purchase price of Model S to one customer plus three times the amount in the form of compensation, since it was found that Tesla had sold a substandard used car to its customer.
A female Tesla owner climbed on top of a car’s roof at the Tesla booth to protest her car’s brake malfunction at the Shanghai auto show Monday. The booth beefed up its security after the incident. pic.twitter.com/ct7RmF1agM
— Global Times (@globaltimesnews) April 19, 2021
In 2021, Tesla faced a public relations storm after an unhappy customer climbed on a car at the Shanghai auto show to protest against the company’s handling of her complaints about her car’s brakes. Tesla responded by apologizing to Chinese consumers for not addressing the complaints in a timely way.
A 3d animation professional with over 20 years of industry experience having served in leading organizations & production facilities of Pakistan, an avid car enthusiast and petrolhead with an affection to deliver writings to help shape opinions. Formerly written for PakWheels as well as major publications including Dawn. Founder of CarSpiritPK.com