China Is The Next Market Ripe For Tesla And Elon Musk
It's safe to say that Tesla has emerged as one of the next powerhouses in the car market. Combining luxury design with a functioning, high-quality electric car, Elon Musk's company has been on an upward trajectory for some time.
That looks like it's going to continue thanks to one of the booming markets that desire the Tesla-style electric car, China.
A Thriving Market
2017 has provided Tesla with no end of good news surrounding the Chinese market. In March, the company revealed that it had made over $1 billion in revenue from its 2016 sales in China. This was the magic bullet that made Tesla a Fortune 500 ranked company for the first time in the company's history. Since then, the company has been on track to double sales in 2017 based on the first three months of imports; showrooms are being crowded by some of China's wealthiest; and Chinese buyers are putting down $1,200 to preorder the Tesla Model 3 in numbers second only to the United States.
This is a massive turnaround for a company that many market analysts believed couldn't be cracked. High tariffs and taxes caused a jump in prices, making the Model S and Model X 50 percent more expensive than any other market. The reason for these tariffs was to prevent importers from getting an edge, trying to push consumers toward electric cars that are manufactured internally.
The Right Connections
Another reason Tesla hasn't broken through in China for a time was a lack of connections in the country. Despite its growth as a major world market, a big reason any foreign companies are able to have any success is through partnerships with major Chinese companies and the government itself. That looks to be changing as well, which could provide Tesla an edge in the market.
Earlier this year, Musk made a surprise visit to China and met with Vice Premier Wang Yang, one of China's top economic officials. What made this unique was Yang's meeting with Musk was a one-on-one instead of the usual group meetings the Vice Premier is known for.
And Yang isn't the only government official who has expressed interest in Tesla. While no names have been given, many higher-ups believe Tesla is the model for other Chinese manufacturers to copy from. Chinese electric cars are not known for providing the best driving experience and battery life, so having a standard like Tesla could help encourage the domestic market and drive up competition.
There have also been reports of Musk meeting with potential partners that could help Tesla start producing cars locally, bypassing the import taxes. Musk believes that China could be the biggest market for Tesla, stating back in 2014 that he wanted Tesla to start building cars in China by 2017 or 2018.
If all this lines up in Tesla's favor, this will make it one of the biggest influencers in the motor industry worldwide.
Kevin Billings Tech Times editor Kevin Billings is a born geek at heart. Whether it's video games, movies, tv, comics, or tech, you will likely find Kevin there. And he feels gratified in his passions now that geek culture has come to dominate mainstream pop culture.