The Wind Waves In China Are Starting To Hit Tesla's Pockets: Sales In April Plummeted

Bloomberg reported that Tesla's sales in China fell last month due to a wave of criticism about the quality of its vehicles. However, the export volume of Tesla cars made in China is showing signs of increase as demand from Europe is gradually recovering.

Tesla sold 25,845 electric cars worldwide in April, down from 35,478 in March. Of which, 14,174 units were exported from the Gigafactory in Shanghai due to strong demand from the European market. .

Over the past few months, Tesla has faced many difficulties in the Chinese market. Accounting for 30% of Tesla's total global revenue, China is the company's second largest market, behind only the US. This is also the market that helped them post record-high first quarter deliveries.

The pressure on Tesla's already very good relationship with Beijing began to mount a few months ago.

In January, Chinese lawmakers spoke out about consumer reports of battery burns, and software update bugs in Tesla vehicles.

In March, Tesla came under scrutiny when the Chinese military banned the use of its vehicles due to safety concerns. A few days later, Musk appeared in a video saying that if Tesla used his car as a spy in China or anywhere, Tesla should be shut down.

Last month, Tesla became a target of state media and Chinese authorities after an angry customer complained about the brakes not working. Specifically, a woman climbed on a Tesla car during the Shanghai auto show to talk about this issue.

Currently, the Chinese side is considering applying new rules to require the data collected in Tesla vehicles to be stored in China.

Passenger car retail sales rose 12.4% in China last April compared to the same period last year, to 1.64 million units.

China's electric vehicle market is currently dominated by Tesla, SAIC-GM-Wuling Automobile Co. and BYD. In March, these three companies accounted for 55% of the market. However, that is only equivalent to 5% of the total Chinese car market share, which shows that the market is still in its infancy.

For now, Beijing still needs Tesla to push the electric vehicle market, but Tesla needs to be very cautious, "Le said.

Last year, Tesla led the electric vehicle market in terms of sales. But this year, they were defeated by the Hongguang Mini, produced by the SAIC-GM-Wuling Automobile joint venture.

That means Tesla may have to learn how to react more quickly to Chinese consumers. The company is known for its "grow at all costs" culture in Silicon Valley. In the US, that has led to complaints about rushing sales and poor service centers, and concerns about quality issues.