Tesla cars have been added to a purchasing list by the Chinese government for the first time ever, as reported by state-owned media outlet Paper.cn.
This move places Tesla as the sole foreign-owned electric vehicle brand on the government’s procurement catalog in Jiangsu province, alongside domestic brands like Volvo and SAIC.
This decision allows government agencies and public organizations in Jiangsu to buy Tesla vehicles for official use, underscoring the close ties between China and Elon Musk’s company.
The news has sparked discussions on Chinese social media, with some questioning the use of foreign cars by the government.
According to reports, the Jiangsu government clarified that Tesla’s Shanghai-made Model Y is considered a domestic car, not an imported one, addressing concerns over foreign vehicle usage in official capacities.
Tesla’s presence in China has grown significantly, with a massive gigafactory in Shanghai producing nearly 947,000 cars in 2023, primarily for the local market.
China has become crucial for Tesla, accounting for more than half of global electric vehicle sales and a significant portion of its revenue.
However, Tesla faces stiff competition from Chinese rivals like BYD, which briefly surpassed Tesla in EV sales last year. Despite challenges, Tesla has regained ground but remains in a competitive race in the Chinese market.
Previously, Tesla encountered restrictions in China due to security concerns, but those were lifted following assurances regarding data security compliance.
This change coincided with Elon Musk’s visit to Beijing, where he met with Chinese Premier Li Qiang, highlighting Tesla as a model of successful US-China collaboration.
On another front, tensions between China and the West are escalating, as evidenced by the European Union imposing additional tariffs on Chinese EV exports.
This move aims to counter allegedly unfair support for Chinese automakers, impacting companies like SAIC and potentially affecting Tesla’s exports to Europe.
Tesla’s response to these developments and its future strategies in navigating both the Chinese market and international trade dynamics will be closely watched in the coming months.
Credit : CNN