When the Tesla Model 3 was released and started accepting pre-orders on April 1st, people in the US and Europe went crazy. Three weeks later, there were more than 400,000 pre-orders, according to the official statistics.
There are many benefits of driving electric vehicles (EV) such as Tesla:
- Do not require any fuel, which essentially saves money
- Environmental friendly!
- Reduce emissions of greenhouse gases
- Require far less maintenance, especially Teslas–Teslas upgrade their software through Internet access, which is equipped in every model.
- Quiet and Smooth–most electric vehicles do not make any engine sounds and run smoothly
Even though Tesla has gained in popularity in the west, the Model 3 did not gain much attention in China, which is often counted as the second largest market for electric vehicles in the world.
Here are four reasons why Tesla will not succeed in China:
Price is one of the reasons that the Tesla will not take off in China. Due to the heavy import tariffs in China, the price of the new Tesla is incredibly high and many people who are interested in the car cannot afford it. And even if a person is financially able to afford the car, he or she could buy a Porsche in the same price range. The market price for a Tesla Model S in the United States is $81,000, far less than the market price in China, which is $121,000. For the foreseeable future, Tesla is unlikely to take over the luxury market in China.
Discouraging Foreign EV policy
The Chinese government tends to establish policies to protect the domestic EV industry. A good example, which is mentioned above, is heavy tariffs on imported electric vehicles. Another example is that many Chinese local governments were told by the federal to buy domestic EVs for governmental uses, to help develop the domestic EV industry. Furthermore, people tend to not buy a Tesla in China because there are so many nationally subsidized, lower-priced domestic EVs. People are able to buy a relative cheap EV and enjoy the same benefits!
Normally, Tesla and other EVs would not emit any greenhouse gases. However, in coal-dominated power generation countries, such as China, electric cars can emit four times more greenhouse gases than in countries with low carbon power sources, such as Sweden and France. Burning coal to produce electricity also leads to hazardous smog in the air, which heavily impacts people’s health. Even though Tesla, or any EV, does not emit greenhouse gases, the “fuel” it uses actually has worse environmental impacts. Therefore, driving a Tesla would actually have negative impacts on the environment.
Charging stations for the Tesla are a big issue for the Chinese users. It is expensive to build a Tesla supercharger station in China and as a result, there are not many charging stations in Chinese cities. For example, there is only 1 charging station in the mega city, Tianjing, the city next to Beijing which has more than 10 million residents. Tesla buyers therefore have to install their own charging facilities in their parking lots, which is often not feasible since there are limited parking lots in most Chinese cities. Even if Tesla users install their own charging facilities, the horrible traffic in Chinese cities makes Tesla users concerned about depleting their batteries while driving in the city.
There are many reasons that Tesla will not succeed in China. However, Japanese electric vehicles have been very successful in China and they are normally in much lower price. Even though Tesla just has the new Model 3 released, which is also much cheaper, it is still not available in mainland China. Therefore, Tesla would need a larger and quicker step to take over the Chinese automobile market.