The Chinese market for Tesla is potentially much bigger than that of the U.S., despite a common myth about Tesla’s affordability in China. There’s a common implication that many people in China are poor and cannot afford to buy a Tesla, so there is not much of a market for Tesla in China. That ignores the fact that there are also many rich and middle-income people.
Furthermore, a new study shows just how wrong this common lie is that Tesla short sellers tell each other as they convince themselves that they will get rich shorting Tesla.
Credit Suisse Bank published an annual wealth survey last month and it found that 100 million Chinese people ranked in the global top 10%, compared to 99 million in the United States. This means that China has more wealthy citizens than America does.
New study which proves the shorts are wrong. Very good news for Tesla in China and GF3:
Rich Chinese outnumber wealthy Americans for first time – Credit Suissehttps://t.co/hQTtEoI787
— PK24 (@PK2451167992) November 10, 2019
The study also found that the ranks of the world’s millionaires have risen to around 46.8 million. That’s 46.8 million millionaires in the world, and they own a collective $158.3 trillion in net assets. The study also forecasts that global wealth will rise by 27% over the next five years, and that wealth inequality seems to be in a “downward phase.”
The Chinese Market For Tesla
In October, an order form for the Made in China Model 3 appeared on Tesla’s Chinese website and listed a starting price that equated to just over $50,000. Yes, $50,000 may seem like a lot, but it’s less than the cost of the same model imported from the U.S. since import tariffs are at 15%.
Add in the fact that the Chinese have embraced Tesla and the government of China has created a unique partnership with Tesla despite a trade war with the country Tesla originates from, and we have a very welcoming Chinese market for Tesla.
China sees the value of Tesla as it continues to create products that aren’t just creating vehicles to travel in but that also stand out in a way that sets itself apart from other automakers. Tesla has a reputation for being high tech, and China values technology highly.
“China is by far the largest market for mid-sized premium sedans. With Model 3 priced on par with gasoline powered mid-sized sedans (even before gas savings and other benefits), we believe China could become the biggest market for Model 3.” —Tesla
This study from Credit Suisse just adds more weight to the fact that the Chinese market could be a huge one for Tesla, which makes sense since China has a population of 1.4 billion people and has been growing quickly economically for decades.
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