China Market situation and outlook

[Cankooo1]

Tesla Sued by Businesseman Claiming China Trademark Right

First the picture of the businessman:

• First dispute was rejected because the trademark was invalid. But according to the Trademark Office if there is no settlement the decision can be escalated to Intermediate People's Court(higher level court)
• Drastic decline in the amount for compensation. The first attempt he wanted $30 million now the amount has declined to $3 million.

• Local media was not interested in the story so the person contacted Bloomberg. "I waited too long, some domestic media are afraid to speak, I just choose to contact Bloomberg, because Bloomberg dared to speak."He said excitedly in a phone interview for Sina http://auto.sina.com.cn/news/2014-07-08/14301307203.shtml

I think the probability for the person to win in court are really tiny. Most probably he just want to put some pressure over the company by media coverage so Tesla could pay him to let it go.

 

[AlMc]

First the picture of the businessman:
View attachment 53245

• First dispute was rejected because the trademark was invalid. But according to the Trademark Office if there is no settlement the decision can be escalated to Intermediate People's Court(higher level court)
• Drastic decline in the amount for compensation. The first attempt he wanted $30 million now the amount has declined to $3 million.

• Local media was not interested in the story so the person contacted Bloomberg. "I waited too long, some domestic media are afraid to speak, I just choose to contact Bloomberg, because Bloomberg dared to speak."He said excitedly in a phone interview for Sina http://auto.sina.com.cn/news/2014-07-08/14301307203.shtml

I think the probability for the person to win in court are really tiny. Most probably he just want to put some pressure over the company by media coverage so Tesla could pay him to let it go.

This is a situation where if the Chinese Government wants this to go away it will make it happen. Nothing covert, no violence, just continuing to pressure the judicial system in China to make this disappear.

 

[Right_Said_Fred]

First the picture of the businessman...

In my book that is not a businessman, but a scammer/leach/parasite. Not able to create anything, only copy or steal.

 

[maoing]

China government will exempt purchase tax for new energy cars both domestic and imported for 3 years from sept. 2014.
http://finance.sina.com.cn/china/20140709/182419655417.shtml

The purchase tax is about 10% of sales price excluding VAT (value addition tax), take S85 base price as an example:
$81,070 US price
$3,600 Shipping & handling
$19,000 Customs duties & taxes
$17,700 VAT

purchase tax = ($81,070 + $3,600 + $19,000) x 10% = $103670 x 10% = $10367

So it essentially gives Chinese customer $10K incentive to purchase Tesla Model S.

 

[kenliles]

China government will exempt purchase tax for new energy cars both domestic and imported for 3 years from sept. 2014.
http://finance.sina.com.cn/china/20140709/182419655417.shtml

The purchase tax is about 10% of sales price excluding VAT (value addition tax), take S85 base price as an example:
$81,070 US price
$3,600 Shipping & handling
$19,000 Customs duties & taxes
$17,700 VAT

purchase tax = ($81,070 + $3,600 + $19,000) x 10% = $103670 x 10% = $10367

So it essentially gives Chinese customer $10K incentive to purchase Tesla Model S.

thanks for that- fairly significant, especially for those tertiary markets on the edge- of course those also require enough volume to reach, so this may take a while to have any impact on Tesla

 

[DaveH]

China to Exempt Electric Cars From 10% Purchase Tax - Bloomberg

No sale tax for Tesla in China ... this is huge

 

[JRP3]

OR the grocer can double his prices, thus dissuading people from buying food that don't really need it, and allowing those that really really need it to buy it later.

Or preventing people who really need it from buying it if they can't afford it, while allowing those who can afford it to buy it, even if they don't really need it.

 

[Lump]

China Targets 30% New Government Vehicles Use Alternative Energy - Bloomberg

China is mandating that at least 30 percent of new government vehicles be powered by alternative energy by 2016 in the government’s latest salvo to combat pollution and reduce energy dependence.
At least 15 percent of new vehicles will use new energy this year in areas such as Beijing and thePearl River Delta in Guangdong province, the government said in a statement posted on the website of the National Government Offices Administration department yesterday. New energy is a term used for electric cars, plug-in hybrids and fuel-cell vehicles.
China’s leaders led by Premier Li Keqiang are intensifying a “war” on pollution after smog levels hit hazardous levels in the nation’s capital last winter. The government has identified electric vehicles as a strategic industry to help it gain global leadership, reduce energy dependence and cut emissions as it pledges to remove polluting cars from the road that have contributed to worsening air pollution.

 

[RobStark]

Or preventing people who really need it from buying it if they can't afford it, while allowing those who can afford it to buy it, even if they don't really need it.

Free markets without artificial price protections/controls almost always allocate resources better than government fiat.

Empty supermarkets in Cuba and full supermarkets in the USA is one of many examples of this.

An example of market distortions is protecting ICE manufactures from legal liability from the pollution they cause.

 

[maoing]

This probably wont' directly benefit Tesla. Obviously government won't buy imported luxury cars. But it'll promote the EV adaoption in China.

China Targets 30% New Government Vehicles Use Alternative Energy - Bloomberg

 

[JRP3]

Free markets without artificial price protections/controls almost always allocate resources better than government fiat.

Empty supermarkets in Cuba and full supermarkets in the USA is one of many examples of this.

You do realize that our food supply has large artificial price protections/control and is no example of a free market. I'm not sure such a thing exists.

 

[RobStark]

You do realize that our food supply has large artificial price protections/control and is no example of a free market. I'm not sure such a thing exists.

Yes, you are talking about global/international wholesale markets.

This discussion was about local retail markets and how best to allocate resources after an emergency.

In real world economics there is nothing that matches perfectly with theoretical constructs.

Since we can't run controlled experiments on real world economies then the only real way to discuss, compare, and contrast is to use approximate theories..

 

[GasDoc]

This probably wont' directly benefit Tesla. Obviously government won't buy imported luxury cars. But it'll promote the EV adaoption in China.

I thought the preferred sedan of government officials is currently an Audi? Are these imports or build in China at a joint venture plant?

 

[maoing]

Yes Audi A6. It's joint venture made.

I thought the preferred sedan of government officials is currently an Audi? Are these imports or build in China at a joint venture plant?

 

[GasDoc]

Yes Audi A6. It's joint venture made.

I'm looking forward to the day a TSLA China joint venture factory is announced!

 

[SteveG3]

According to one report the sales tax waiver in China will not apply to imports, including Tesla. Perhaps the story is inaccurate or incomplete.

"A key sales tax will not be waived on purchases of electric cars made outside of China, said Su Bo, China's vice-minister of the Industry and Information Technology Ministry, according to China Daily. ..."

http://www.theflyonthewall.com/permalinks/entry.php/KNDI;TSLA;NSANY;GMid2040537/KNDI;TSLA;NSANY;GM-Chinese-electric-vehicle-maker-Kandi-surges-after-tax-break-news

 

[DaveH]

inaccurate report, Su Bo said Tesla is not qualified for Chinese government's alternative energy vehicle subsidies, nothing about the purchase tax.

 

[pGo]

inaccurate report, Su Bo said Tesla is not qualified for Chinese government's alternative energy vehicle subsidies, nothing about the purchase tax.

Tesla loses out on green car sales boost project|Industries|chinadaily.com.cn

This report talks about purchase tax too.

 

[maoing]

I'm native Chinese speaker. No, the Chinese media only quoted excluding Tesla from government subsidy which is the current situation anyway, but it has nothing to do with waiving sales tax.

Tesla loses out on green car sales boost project|Industries|chinadaily.com.cn

This report talks about purchase tax too.

 

[pGo]

I'm native Chinese speaker. No, the Chinese media only quoted excluding Tesla from government subsidy which is the current situation anyway, but it has nothing to do with waiving sales tax.

This looks like a new development and the issue here is funding not available - hence removing imported vehicles from the list. Another link:
Tesla Motors Inc. (NASDAQ:TSLA) loses on Car Sales Boost project

If you can help find the latest on this, that will be helpful.