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Tesla Begins Taking Model 3 Reservations in China

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【Summary】Electric automaker Tesla has opened reservations in China to purchase the Tesla Model 3. Beginning today, customers in China can reserve their Model 3 with a deposit of 8,000 yuan ($1,153.60), according to Tesla’s China website

Eric Walz    Nov 16, 2018 11:32 AM PT
Tesla Begins Taking Model 3 Reservations in China

Electric automaker Tesla has opened reservations in China to purchase the Tesla Model 3.  Beginning today, customers in China can reserve their Model 3 with a deposit of 8,000 yuan ($1,153.60), according to Tesla's China website www.tesla.cn/model3/reserve.

Customers should receive their cars by spring 2019, according to Tesla CEO, Elon Musk.

"Probably some deliveries in March, but April is more certain", Musk tweeted after a Twitter user asked when the Model 3 deliveries in China would begin.

The Model 3 is Tesla's first mass-market car and the company is counting on brisk sales of the car to achieve profitability.

China is the world's largest market for electric vehicles and most forecasters predict that its sales in the country will speed up rapidly as government regulation drives toward a goal of 100-percent electric vehicles by 2030.

In July, Tesla had signed a deal with Shanghai authorities to build its first factory outside the United States. The construction costs are estimated to be around $2 billion. The new factory would roughly double the size of Tesla's global manufacturing.

The Shanghai Gigafactory, based in eastern China, plans to manufacture Model 3 and upcoming Model Y crossover, with annual capacity of 250,000 vehicles, according the filing.

Tesla is also developing plans to start producing about 3,000 Model 3s per week in Shanghai in the initial phase of its Gigafactory 3 to reduce the impact of tariffs.

Tesla-model-3.png

The Tesla Model 3

Currently, all of Tesla's vehicle are produced in its Fremont, California assembly plant. With the escalating trade war with the U.S., all Tesla vehicles shipped from the U.S. are subject to a 40 percent tariff, putting the company at a disadvantage from electric cars produced locally.

Tesla said it is operating at a 50 to 60 percent cost disadvantage compared to the exact same car locally produced in China.

In early October, Tesla said it is responding to the heightening trade tensions and increasing costs by "accelerating construction of our Shanghai factory" in order to be more competitive in China. The announcement came days after Tesla announced it was raising prices on its vehicles by 20 percent in China in response to the first round of tariffs.

The Shanghai factory is "roughly" two years from producing vehicles and about five years from pumping out "around 500,000 vehicles per year," Tesla said.

Screenshots of Tesla's mobile design studio that were posted on Chinese social media Weixin show only the Long Range all-wheel-drive and Performance versions as available to preorder.

The Long Rang Model 3 starts at 580,000 RMB ($83,500 USD) while the Performance version starts at 690,000 RMB ($99,400 USD).

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