Sales of Tesla SUV jump in China as bigger cars gain traction

A Tesla Model Y car at the Shanghai International Automobile Industry Exhibition in April. Registrations of the China-made sport utility vehicle rose to 12,785 last month from 5,520 in April, despite a high-profile protest against Tesla at the Shangh
A Tesla Model Y car at the Shanghai International Automobile Industry Exhibition in April. Registrations of the China-made sport utility vehicle rose to 12,785 last month from 5,520 in April, despite a high-profile protest against Tesla at the Shanghai car show and a ban on some of the automaker's vehicles from government buildings due to security concerns. PHOTO: AGENCE FRANCE-PRESSE

BEIJING • Tesla sales of China-made Model Y cars more than doubled last month, allaying for now concern that a high-profile protest and a ban on some of the automaker's vehicles from government buildings due to security concerns may have hurt demand.

Registrations of the sport utility vehicle (SUV), which in China starts from around US$53,000 (S$71,000), rose to 12,785 last month from 5,520 in April, data from China Automotive Information Net shows. Registrations of the cheaper Model 3 sedan were 9,324, up from 6,429.

April's figures were well down from March because some production lines at the Shanghai factory were suspended for two weeks for maintenance and adjustment. Tesla started making deliveries of the Model Y in China only in January.

"Once the Model Y gets to full production, we'll probably see a ratio of almost a two to one" versus Model 3s, said Mr Tu Le, the managing director of Beijing-based consultancy Sino Auto Insights.

"Chinese consumers love SUVs and crossovers. I think the Model Y is going to do really well towards the end of this year."

Data from China's Passenger Car Association released earlier this month also showed Tesla's China shipments rebounded in May, with the electric car pioneer reporting wholesales of 33,463 locally made vehicles last month, compared with 25,845 in April.

There has been some concern about how demand for Tesla cars may be impacted by a protest that went viral at the Shanghai car show in mid-April, and by a spate of crashes that may have soured public opinion towards the California-based company.

In another setback, some local governments and official institutions are reviewing Tesla ownership among their staff, citing concerns that the cars pose security risks, Bloomberg reported last month.

The electric vehicles have also been banned from some military complexes and housing compounds over concerns about data being collected by in-built cameras. Tesla has moved to reassure the authorities, saying any data collected in China is stored locally.

While Tesla's May wholesale figures may not necessarily reflect the level of retail demand Tesla fields directly, the Passenger Car Association is forecasting increased interest in larger, roomier cars.

Last week it adjusted its outlook for total new-energy vehicle annual sales to 2.4 million cars from 2.2 million, noting that China's policy to let families have three children should benefit the car market, particularly in the seven-seater category.

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A version of this article appeared in the print edition of The Straits Times on June 19, 2021, with the headline 'Sales of Tesla SUV jump in China as bigger cars gain traction'. Subscribe