Published on October 1st, 2019 | by Kyle Field0
Tesla Ends Base Model 3 Shipments Into China As Gigafactory 3 Production Comes Online
October 1st, 2019 by Kyle Field
Tesla will cut off orders of the Model 3 Standard Range after October 13th in anticipation of the start of production at Gigafactory 3 in Shanghai, China. The news comes from Tesla China’s official social media account and is sure to cause commotion in an already excited market for the American automaker.
The cautionary note indicated that the last shipment of Tesla Model 3s into the country is being locked in as the company looks to transition to locally built vehicles for the first time in its history.
Chinese social media:
“All Tesla Model 3 Standard Range will not accept order after Oct 13th, this will be the last shipment of the Made in US Model 3, plz have ur test drive be4 Oct 7th and lock-in ur orders”
— Vincent (@vincent13031925) October 1, 2019
The update is likely to cause excitement on both fronts as customers looking to get into a Tesla Model 3 Standard Range (SR) soon will look to pull the trigger on an order in the next two weeks. On the other hand, customers looking to buy one of the first Made in China Tesla Model 3s from the brand spanking new Gigafactory 3 will also be chomping at the bit to drop an order as soon as the last imports are sold.
The Tesla Model 3 has proven to be quite popular in China, with auto registrations from last quarter indicating a sharp uptick in sales of the Tesla Model 3. An analyst at Piper Jaffray found that new auto registrations in the third quarter were up more than 175% compared to Q3 2018. The data is some of the only evidence we have to date about Tesla’s sales performance in the country until it releases its own delivery data later this week.
"Tesla’s deliveries to real, actual people are still rising at a triple-digit pace, despite being hamstrung by import duties, a flagging auto market, and a historical inability to tap EV subsidies,” Piper Jaffray analyst Alexander Potter https://t.co/txyMPhAxvV
— Techgnostik (@Techgnostik) September 26, 2019
The sharp uptick in demand is even more staggering when the hurdle of international shipping and the tariffs that go along with it are taken into account. Tariffs are also one of the large drivers behind Tesla’s move to build a factory in China as it continues to expedite construction of its first automotive factory outside of the United States. The new factory is an awkward failure in President Trump’s bumbling attempt to keep more jobs in the US, creating a counterproductive trade war with the world’s manufacturing superpower.
Related or not, Tesla’s success in China comes as US automotive sales floundered in September, with Toyota, Honda, and Nissan all admitting to year-on-year sales declines in the 15% range, according to a recent Bloomberg report.
Tesla, it seems, is kicking its sales teams into high performance mode in the world’s largest automotive market as production begins at its Shanghai factory. Building locally means the end of import tariffs from the price of its vehicles and comes nearly in parallel to the company receiving a waiver for local sales tax that equates to a nearly 10 percent savings for Chinese customers.
The numbers are encouraging for Tesla, but represent just the beginning of what is possible as Tesla shirks off the burden of Trump’s trade war in favor of a red carpet welcome in China. Q4 may have the potential for some truly Ludicrous sales, but Elon and the team at Tesla will likely be seeing through Plaid colored glasses in 2020 with the launch of the Model Y.
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