Tesla Inc.’s China factory shipments rose in February as price cuts piqued interest in its vehicles and consumer spending kicked back into gear following Covid outbreaks across the country.
(Bloomberg) — Tesla Inc.’s China factory shipments rose in February as price cuts piqued interest in its vehicles and consumer spending kicked back into gear following Covid outbreaks across the country.
The automaker’s wholesales rose 13% from January to 74,402 vehicles, according to preliminary data from China’s Passenger Car Association released Friday. While that’s up 32% from a year ago, shipments from Tesla’s Shanghai factory were well short of the record 100,291 vehicles reached in November.
Tesla shares rose 1.6% at 9:32 a.m. New York time Friday. The stock fell almost 6% on Thursday after the company didn’t show any new models during its hours-long investor day.
When asked at the event about Tesla’s growth prospects in China and whether tensions with the US affect the company’s ambitions, a top executive downplayed concerns. Bloomberg reported in January that an expansion of the Shanghai plant had been delayed because some central government officials were anxious about any links between Tesla and Starlink, Elon Musk’s internet-from-space business.
“As long as you offer a product with value at an affordable price, you don’t have to worry about demand,” Tom Zhu, Tesla’s head of global production, told an analyst. He said the carmaker’s price cuts early this year “generated huge demand, more than we can produce, really.”
While Tesla continues to dominate the US electric-vehicle market, it’s running into stiffer competition in China. Rival BYD Co., which makes both fully electric and plug-in hybrid models, more than doubled shipments last month to 193,655 vehicles.
Related: BYD Has Tesla In Its Sights After a Year of Runaway Growth
China’s wholesales of new-energy passenger vehicles are forecast to rise 30% month-on-month to around 500,000 units in February, according to the PCA. The association said lower prices for lithium carbonate, a key material in EV batteries, led some automakers to slow production in anticipation that input costs may fall further.
(Updates with shares trading in the third paragraph. An earlier version of this story corrected the percentage increase from a year ago in the second paragraph.)
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