The Chinese company Qiantu Motor has decided to establish an electric vehicle manufacturing facility in China
Tesla Motors’ dream of progressing in China is on the verge of getting crushed. A local company Qiantu Motor is establishing a factory in the country to manufacture electrically powered vehicles to battle with Tesla models, as reported by Bloomberg after verifying from company’s chairman Lu Qun. Dubbed as the K50, the vehicle will feature a carbon fiber body, and will be offered at a retail price of $106,000(700,000 yuan). The all-electric roadster will be developed to contest with Model S –Tesla’s popular model.
Lu further expressed that the decision of launching an electric car was made after carrying out thorough analysis of US automaker giant’s business. He stated that Tesla has been source of learning for the organization.
China is haven for electric car makers. Recently, the country has been under severe criticism for causing pollution. Therefore, the state has been formulating new rules to make the region green. Likewise, it rewards the organizations which produce environmental friendly products. Indeed, some critics have made an argument that the country’s latest environmental efforts are one of the strongest in the globe.
It was these reforms which made the California based organization to make efforts to enter China. Tesla had expectations of enticing a huge upper-middle class wishing to have a green vehicle. The automaker introduced its first vehicles in the country two years ago, but its sales in the region were disappointing.
CEOElon Musk claimed that the sluggish sales were because of the consumer misunderstanding that charging his organization’s vehicles would be quite difficult. In 2015, Musk stated he held the belief that the automaker could turn its business in the Chinese region around by getting more vehicles on roads and educating consumers in a better manner.
Nevertheless, Elon’s predictions were off. Last year, the automaker had a tough year which compelled it to cut down job opportunities in the country. The disappointing results have not gone unseen amongst shareholders and analysts, who state that China could be a crucial market for the electric car maker to establish in the upcoming times.
CTO of Tesla JB Straubel stated last month that the organization is still not ready to establish a facility in the country. JB did state, nevertheless that the electric car pioneer could finally take the move once demand for the organization’s vehicles reaches “critical mass” in China.
But it has not completely lost. Despite of these problems, there are indications that the company might be blending into the region. In fact, Chinese consumers turned out to be the second largest pre-order group previously this year when Tesla Motors launched its Model 3, an affordable alternate to its expensive Model X and Model S vehicles.
How Tesla will strategize its move to contest with the local competitors will be on acute watch of the analysts and investors.
No comments:
Post a Comment