Tesla sales in China fell -11.5% for the month of January, mainly due to increased saturation and competition in the Chinese market.
Tesla sold 63,238 vehicles in January, an 11.5% drop from last year, pushing its shares down 1.5% in premarket trading. In contrast, Chinese rival BYD saw a 47% year-over-year jump, selling 296,446 EVs and hybrids, according to CNBC.
Chinese rivals like Changan Automobile and Xpeng reported sales growth, while Tesla has relied on price cuts and incentives to stay competitive.
The CNBC report said that the company slashed Model Y prices, extended a zero-interest five-year loan plan through January, and launched a revamped Model Y in China with 0% financing. Tesla hasn’t introduced a new model since the late-2023 Cybertruck, starting at nearly $80,000, leaving investors eager for a new mass-market vehicle, which may debut in early 2025.
Blog electrek, which has been critical of Tesla over the last year or so, called the sales "relatively fine despite the added complexity of managing the production switch to the new Model Y".
They noted that the Model Y, Tesla’s top seller, is undergoing a design refresh at its Shanghai Gigafactory, leading to lower production this quarter.
While sales have dipped, the decline isn’t drastic given the changeover, the blog said. A bigger impact is expected in February due to Chinese New Year and planned production halts from January 22 to February 14, which will reduce inventory through March.
They admitted that politics likely didn't play as big of a role in the sales dropoff as many thought: "The new Model Y is having an impact everywhere, but Elon Musk’s meddling in politics and subsequent drop in reputation also has an effect, except in China, where they don’t care about that as much."
