According to a recent report, Elon Musk arrived China this week. While speaking to the audience at Tsinghua University, he said his company will be building an upcoming Model 3 of Tesla. He said the car is meant to be affordable and that it will be built in a Chinese factory within two years. Before now, most of Tesla cars were built in Fremont, California and then imported to China, but this new announcement is a move by Tesla to sell even more cars in China.
The way things are done in China is that before you purchase a car, you must be able to prove to the Chinese government that you have a parking lot for your car. Then when you have done that, you will have to participate in a lottery to get a registration for the car. In China, some people have had to wait for up to 5 years before they get their license for their car. Interestingly, those with electric cars are quickly attended to and get their registration faster.
China also imposes significant import duties on cars manufactured in other countries. That’s why General Motors, Ford, Toyota, BMW, Volvo, Jeep and every other manufacturer in the world have been making cars for the Chinese market in China for the past decade. If you want to sell in China, you need to partner with a Chinese company.
This has caused a lot of Chinese citizens to drive China made cars. To sell affordable cars in China, you must partner with a domestic manufacturer. However, Tesla do not consider themselves bound by what people think or say. They want to pioneer something new.
According to Tesla, its Chinese factory will make use of the same technology employed at its factory in Fremont. By implication, the Model 3 will cost about $35,000 and have a range of 200 miles or more. Also, the Chinese customers will again be satisfied as they will be purchasing domestically manufactured cars.
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