Sales of Tesla’s electric vehicles (EVs) made in China continued their downward trajectory in May, tumbling 15% from a year earlier, data from the China Passenger Car Association showed on Wednesday.
This is the eighth consecutive month of declines in sales of Tesla’s China-made EVs amid a brutal price war in the country and intense competition with local carmakers, particularly BYD.
Year-on-year deliveries of China-made Model 3 and Model Y vehicles, including both domestic sales and exports to Europe and other markets, fell to 61,662 vehicles, after a 6% fall in April. They were, however, up 5.5% from April.
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In comparison, global passenger vehicle sales at BYD rose 14.1% year-on-year to 376,930 units in May, slowing from April’s 19.4%.
Tesla’s EV sales also continued to plummet across much of Europe last month, as its aging model lineup and CEO Elon Musk’s political activities deterred buyers.
To spur sales in China, its largest market, Tesla last week offered ‘smart-assisted-driving’ capability transfers to new vehicles in the country through the end of June.
Model 3 and Model Y vehicles were also added to a Chinese government-backed campaign to promote EV sales in rural areas for the first time this year.
Still, Tesla remains under pressure from new lower-priced high-performance models in the market. For instance, its key rival BYD’s cheapest model, the pure battery-powered Seagull hatchback, is currently priced more than five times cheaper than Tesla’s entry-level Model 3.
Despite that, however, the Seagull is packed with top technology features, including a free basic Advanced Driver Assistance System (ADAS).
BYD is also driving the bruising price war in China’s EV industry, with its latest discounts giving top rivals jitters on the possibility of an impending “Evergrande moment” in the sector. Ironically, that price war was initiated by Tesla in 2023.
China, meanwhile, has urged a halt to the price wars and is currently also pushing to tighten its regulatory hold over the sector.
- Reuters, with additional editing by Vishakha Saxena
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