Tesla’s China sales have best month of the year in August

BEIJING, China: Tesla’s sales in China hit a high point for the year in August, selling over 63,000 cars, a 37 percent increase from July. Despite this improvement, sales are likely still down from August of the previous year when Tesla sold 64,694 vehicles.

While Tesla’s recent sales boost is encouraging, the company still trails behind major local competitors. BYD, the largest electric vehicle (EV) maker globally, reported record sales of 370,854 passenger vehicles in China for August, a 35 percent increase from the previous year. Other local EV makers like Leapmotor and Li Auto also saw significant sales growth.

Tesla and other automakers have been affected by a prolonged price war in China, compounded by sluggish economic growth and weak consumer confidence. As a result, Tesla’s China sales fell by 5 percent in the first half of the year.

Tesla has regained momentum despite reducing its local sales force due to global downsizing. In April, the company introduced zero-interest loans for up to five years for buyers, and some local governments have recently included Tesla cars in their official vehicle purchase programs.

Earlier this year, Tesla also gained significant regulatory approval from China’s top auto industry association, which confirmed that Tesla’s data collection practices complied with regulations. This approval allowed Tesla vehicles to enter certain government compounds from which they were previously barred.

According to China Merchants Bank International, Tesla’s sales in smaller, tier-three cities surged 78 percent year-on-year in July, while sales in larger, second-tier cities like Hangzhou and Nanjing increased by 47 percent.

Data from the China Passenger Car Association showed that sales of Tesla’s China-made vehicles, including exports, grew by 3 percent in August year-on-year to 86,697 units. Deliveries of the China-made Model 3 and Model Y rose by 17% from July.

To further enhance its market position, Tesla plans to produce a six-seat variant of its Model Y in China by late 2025, according to sources familiar with the matter. This move is intended to rejuvenate interest in its popular yet aging EV model.