China Market situation and outlook

[Auzie]

I wonder how precedent is Elon meeting with Chinese gov. senior officials?

Do other foreign businesses get the same or similar treatment? Could it be that Elon just gets more publicity but no extra or precedent treatment from officials?

 

[maoing]

more reports here http://www.xtesla.com/thread-824-1-1.html

"AA" car leasing company ordered 100 model S
"YiHai" car leasing company ordered 100ish model S
"YiDao" car leasing company in talk with Tesla to purchase 1000 model S

Definitely "fleet sale" is the innovation from Vironica Wu's team.

Great news!

also I found another report http://tech.sina.com.cn/it/2014-04-25/04269343885.shtml

It mentions a taxi company ordered 100 model S. The company CEO is not happy now because the delivery delayed from end of March to end of April. It looks the fleet sale might go well in China.

 

[MikeC]

more reports here http://www.xtesla.com/thread-824-1-1.html

"AA" car leasing company ordered 100 model S
"YiHai" car leasing company ordered 100ish model S
"YiDao" car leasing company in talk with Tesla to purchase 1000 model S

Definitely "fleet sale" is the innovation from Vironica Wu's team.

Wow.

 

[Auzie]

Thank you maoing. It is all great news, and very recent news. Referenced forum post (your first link) states that it was uploaded half an hour ago.

It seems that Tesla will be selling very well in China.

 

[Benz]

more reports here http://www.xtesla.com/thread-824-1-1.html

"AA" car leasing company ordered 100 model S
"YiHai" car leasing company ordered 100ish model S
"YiDao" car leasing company in talk with Tesla to purchase 1000 model S

Definitely "fleet sale" is the innovation from Vironica Wu's team.

Great news.

 

[Cankooo1]

View attachment 47777

It is confirmed. After meeting with the governor of Shanghai , local government reserves 3 000 plates which will be provided to Tesla owners for free, each one costs $16 000.
This is just the first incentive for Tesla in China, it is on a local level but the total amount is $48 millions.
The central government is still working on special conditions for Tesla like reducing the import tax and other incentives.

I want to apologize for my mistake: the person on the photo with Elon Musk is Chinese Science and Technology Minister Wan Gang.
It was attached in the same article reporting the free plates.

 

[yngwie_2012]

More good news! According to this source, the Tesla suppliers in Taiwan stating actual production speed is 1000 Model S / week.

Tesla seeing short production capacity, say Taiwan makers

 

[Benz]

More good news! According to this source, the Tesla suppliers in Taiwan stating actual production speed is 1000 Model S / week.

Tesla seeing short production capacity, say Taiwan makers

The last I heard was that they were at a weekly production rate of about 700 a week, right?

 

[eepic]

The last I heard was that they were at a weekly production rate of about 700 a week, right?

I think it was one of the analysts that said on their factory floor it was going at 700/week a few weeks ago.

 

[Benz]

I think it was one of the analysts that said on their factory floor it was going at 700/week a few weeks ago.

I will be (pleasantly) surprised if the weekly production is more than 800 per week.

 

[maoing]

"Foxconn Group president Terry Guo met with Tesla CEO Elon Musk in Beijing, northern China, recently."

The cooperation with Foxconn will be important for Tesla. The major difference between Tesla and Apple is Tesla doesn't have Foxconn type of manufacturer, so good product can't flood into main street in short time.

More good news! According to this source, the Tesla suppliers in Taiwan stating actual production speed is 1000 Model S / week.

Tesla seeing short production capacity, say Taiwan makers

 

[StapleGun]

More good news! According to this source, the Tesla suppliers in Taiwan stating actual production speed is 1000 Model S / week.

Tesla seeing short production capacity, say Taiwan makers

I'd take this with a grain of salt. "About 1000 a week" probably means their current order rate from this supplier is around that, but supplier volume leads production volume by a few months. Tesla could still be at 700/week but starting to increase their stock of parts from suppliers in anticipation of the H2 ramp up they guided for.

Encouraging news none-the-less. Thanks for posting!

 

[Benz]

I'd take this with a grain of salt. "About 1000 a week" probably means their current order rate from this supplier is around that, but supplier volume leads production volume by a few months. Tesla could still be at 700/week but starting to increase their stock of parts from suppliers in anticipation of the H2 ramp up they guided for.

Encouraging news none-the-less. Thanks for posting!

Yes indeed. In the second half of 2014 they will reach a weekly production rate of 1,000.

 

[vgrinshpun]

I'd take this with a grain of salt. "About 1000 a week" probably means their current order rate from this supplier is around that, but supplier volume leads production volume by a few months. Tesla could still be at 700/week but starting to increase their stock of parts from suppliers in anticipation of the H2 ramp up they guided for.

Encouraging news none-the-less. Thanks for posting!

I think that another very interesting takeaway from this article that it seem to suggest that the rate of incoming orders is higher than what they state the current production is i.e. 1,000 cars per week:

US-based electric vehicle maker Tesla Motors has seen production capacity fall far short of its fast growing global demand...

Regarding the 1000cars week production rate it seems to be not possible unless Panasonic is ahead of schedule restarting the mothballed production lines. Reposting from the other thread:

This seem to be a bit too high of a production rate for now. According to previous reports the battery cell production ramp up was to happen in two steps: first launching idling line(s) at the Suminoe Plant in Osaka in the begining of this year, followed by launching additional mothballed line(s) at another Osaka plant in 2H 2014. The full capacity of the Suminoe plant is 300M cells/year, so it can cover about 900 cars/week assuming that 90% of ordered cars are 85kWh.


So this seem to be possible only if Panasonic launched mothballed lines not only at the Suminoe plant, but also at another plant in Osaka earlier than planned.

 

[Muskol]

Some more China footage I don't recall being posted here - ignore the erroneous title:

Tesla Motors Megafactories - The Future of Electric Cars - YouTube

 

[Cankooo1]

Musk: China Will Pass U.S. as Biggest Tesla Market:
[video]http://www.bloomberg.com/video/musk-china-will-pass-u-s-as-biggest-tesla-market-F~b5YNdOSf~o1bJ9C8HXRQ.html[/video]

 

[maoing]

Musk mentioned probably over half of the production will be exported overseas, and among them, half of them will go to China. So I think he implies 25% or more production will go to China. Did I miss sth.?

Musk: China Will Pass U.S. as Biggest Tesla Market:
[video]http://www.bloomberg.com/video/musk-china-will-pass-u-s-as-biggest-tesla-market-F~b5YNdOSf~o1bJ9C8HXRQ.html[/video]

 

[kenliles]

Musk mentioned probably over half of the production will be exported overseas, and among them, half of them will go to China. So I think he implies 25% or more production will go to China. Did I miss sth.?

that's the way he said it yes. I think the context of the answer was for this year: 50% US, 25% each Europe/China. But in follow on years will ramp to 3 somewhat equal market sizes, but in out years China actually taking the lead, then US, then EU. That's the scenario he painted in my head.

My conjecture:
Based on that, I would guess-timate he's already looking at both a China and EU manufacturing plant for GENIII timeframe. He also mentioned that middle level market (GENIII target) is not as strong in China currently (relative to US). They have a stronger market in the luxury class, and a stronger market in the economy class. That would lead to thoughts that GENIII production will again be initially targeted to US, then EU, then China.

 

[maoing]

I found more informaiton about this report.

"AA" (http://www.aayongche.com/) already has Tesla reservation in mobile app. So I think 100 order is real.

"YiHai" (http://www.1hai.cn/)

"Founded in January 2006 with the goal of providing comprehensive car rental services to both retail and corporate clients, eHi is the first car rental company utilizes the latest information technology to achieve a complete service delivery and vehicle management system in China. With its headquarter based in Shanghai, eHi offers car rental services nation-wide with more than 500+ eHi outlets located in more than 80 cities. eHi has a fleet of more than 13,000 vehicles including over 100 different models. During the past eight years since its establishment, eHi has experienced a steady and rapid growth while achieving industry leading vehicle utilization rate and brand-name recognition."

eHi's CEO picked up 2 model S among the 7 of first batch Shanghai delivery from Elon Musk. So I think the 100ish order is real also.

"YiDao" (http://www.yongche.com/)

I haven't seen more concrete information yet. So I guess it's still under negotiation. But 1000 order which is worth almost 1 billion Chinese Yuan sound too big.

more reports here http://www.xtesla.com/thread-824-1-1.html

"AA" car leasing company ordered 100 model S
"YiHai" car leasing company ordered 100ish model S
"YiDao" car leasing company in talk with Tesla to purchase 1000 model S

Definitely "fleet sale" is the innovation from Vironica Wu's team.

- - - Updated - - -

Thanks Kenliles. I think GEN III would be still in luxury category for China market and Model S is in premium luxury category. Elon mentioned the Shanghai municipal government waive the license plate fee the same day he arrived there. This is actually a pro attitude to attract Tesla to set up manufacture in Shanghai which is the base for GM and VW now.

In the future, IMO Tesla should keep premium luxury sedan/suv (S/X) manufacturing in fremont factory. And outsource GEN III to China/Europe and other US states.

that's the way he said it yes. I think the context of the answer was for this year: 50% US, 25% each Europe/China. But in follow on years will ramp to 3 somewhat equal market sizes, but in out years China actually taking the lead, then US, then EU. That's the scenario he painted in my head.

My conjecture:
Based on that, I would guess-timate he's already looking at both a China and EU manufacturing plant for GENIII timeframe. He also mentioned that middle level market (GENIII target) is not as strong in China currently (relative to US). They have a stronger market in the luxury class, and a stronger market in the economy class. That would lead to thoughts that GENIII production will again be initially targeted to US, then EU, then China.

 

[kenliles]

I think GEN III would be still in luxury category for China market and Model S is in premium luxury category.

good point- that may well be the lower side of the luxury market in China, especially the 'souped-up' versions of it. In addition, the middle China middle-class is growing. If so, they may go all in for a plant in China commensurate with GENIII. Thanks for that perspective