In a recent development, Tesla has made a significant change on its Chinese website by removing the option to purchase new Model S and Model X vehicles. This decision comes amidst escalating trade tensions between the United States and China, with the “place new order” button now missing for both models. However, customers still have the option to order from existing inventory. It is worth noting that orders for other Tesla models, such as the Model 3 and Model Y, which are manufactured at the company’s Shanghai factory, remain unaffected by this change.
The Model S and Model X vehicles are imported from the United States, and industry analysts speculate that the decision to remove the option to buy new models may be a response to higher tariffs imposed on imported goods. CCB International analyst Qu Ke commented that these two models are considered relatively old and come with a higher price tag, making them less competitive in the Chinese market.
This move by Tesla comes at a time when trade tensions between the U.S. and China are on the rise, with both countries implementing trade measures against each other. The White House has indicated that total tariffs on Chinese goods could potentially reach 145%, prompting China to retaliate by increasing tariffs on U.S. goods to 125% and imposing restrictions on U.S. film imports.
Furthermore, Tesla is facing increasing competition from local electric vehicle manufacturers in China. Despite selling nearly 79,000 cars in the country in March, the company experienced an 11% decline compared to the previous year. Additionally, only around 5,000 vehicles were exported during this period.
It will be interesting to see how Tesla navigates these challenges and adapts its strategies in the face of evolving trade dynamics and competition in the Chinese electric vehicle market. As the company continues to innovate and expand its product offerings, it will be crucial to monitor how these external factors impact its operations and sales in the region.