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Benz
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This has HUGE and ESSENTIAL impact on the whole HK market for EVs, and potentially 1000s of Tesla model S (and X?). Model E, remains to be seen three years from now, whether or not it will be exempt, yet again.
FRT Exemption extended to March 31st, 2017.
No, this is not just like a "$7,500 incentive". Without the FRT exemption, a full spec model S would be 2.3 TIMES more expensive in Hong Kong.
Check the Hong Kong forums for more
Hong Kong
We are all buzzing with excitement!
"Proposed" in Hong Kong law apparently means as good as final. Mark?
I don't have TSLA stock, or any other stock for that matter. Any signs in TSLA value? Maybe markets are closed now in the US, let's see when it's Wednesday morning in the US
There has been so much news regarding Tesla the last two days that this has been drowned out by the gigafactory speculation. It's great to hear this important victory in HK though, and congrats on your order!!
Thank you, investors and other interested users, this is really a very important milestone for Tesla Motors, and in particular, Tesla Motors Hong Kong.
When I ordered the model S back in December 2012, I knew it could become a close race if I could get the car before or after March 31st, 2014. As even the very first HK deliveries will be after this date, it's great relief, after all the waiting, that we will indeed be able to buy it as expected.
Imagine all the people who paid up deposits for either standard or Signature - had it not been extended, I imagine most of those deposits would have been claimed back. Instead of Tesla Motors paying back millions of USD to reservation holders, they can now look forward to massive sales of the RHD Tesla model S in Hong Kong.
Next up, three years from now, will be the question of whether or not it will be extended once again. This will mainly be interesting for the Tesla model E, as I imagine it will reach Hong Kong well after March 31st, 2017.
At least, the Tesla model E will have a far less impact of FRT (First Registration Tax), as it is much cheaper. The FRT is progressive, so for the cheaper cars, there isn't as much FRT anyway.
My guess (and hope) is, that next time time the FRT will be up for negotiation in the budget, it might be a gradual decrease of the exemption. No-one is at advantage (apart from ICE auto makers/sellers/repair shops) if the drop is sudden. From 2017, it would be beneficial if the FRT would increase with 1% a month, for instance, that would ensure that electric cars would start paying FRT, while the difference of production cost compared to ICE cars will level out.
When I ordered the model S back in December 2012, I knew it could become a close race if I could get the car before or after March 31st, 2014. As even the very first HK deliveries will be after this date, it's great relief, after all the waiting, that we will indeed be able to buy it as expected.
Imagine all the people who paid up deposits for either standard or Signature - had it not been extended, I imagine most of those deposits would have been claimed back. Instead of Tesla Motors paying back millions of USD to reservation holders, they can now look forward to massive sales of the RHD Tesla model S in Hong Kong.
Next up, three years from now, will be the question of whether or not it will be extended once again. This will mainly be interesting for the Tesla model E, as I imagine it will reach Hong Kong well after March 31st, 2017.
At least, the Tesla model E will have a far less impact of FRT (First Registration Tax), as it is much cheaper. The FRT is progressive, so for the cheaper cars, there isn't as much FRT anyway.
My guess (and hope) is, that next time time the FRT will be up for negotiation in the budget, it might be a gradual decrease of the exemption. No-one is at advantage (apart from ICE auto makers/sellers/repair shops) if the drop is sudden. From 2017, it would be beneficial if the FRT would increase with 1% a month, for instance, that would ensure that electric cars would start paying FRT, while the difference of production cost compared to ICE cars will level out.
Another problem with the FRT exemption is that it is open to abuse by car manufacturers / distributors. I am glad to see Tesla's fair pricing, and wonder why it can't be applied across the board. The FRT break for Nissan Leafs here goes straight into the pocket of the local distributor (who price it at US$53.5k tax free, vs US$30k in USA). The reason for the US$53.5k price? I suspect because the hit-selling Prius is US$37k and they think they can get away with the premium on that. The purpose of the FRT exemption is to offset the price of the batteries and make the cars affordable, not to stuff the pockets of the local distributor.
That is what I was thinking all this time, Mark. Nissan just lowered the price, and that well in time, as the Tesla model S is coming!
Cheapest Tesla model S in Hong Kong at 579,000 HKD is equivalent of 75,000 USD. Imagine a 53,500 USD Nissan Leaf vs a 74,000 USD Tesla model S? The Nissan is a cheap small car with no specs, and outdated technology, while the Tesla model S is huge, has twice the range and so many more features.
Yes, Nissan has been abusing the system, and HK should have built in protection in the FRT exemption against such abuse.
Shame on you, Nissan! Good on you, Tesla!
Renewing the frt seems like a pretty major roadblock (pun intended) removed for the Asian market, kind of surprised that no formal acknowledgement has come from Tesla saying that like 500 orders were placed overnight or at least something from the media. Are they waiting for it to be formally passed or was there just too much Tesla news already going on last week?
That's a very good point, haven't thought of that! I haven't seen anything on the local news from Tesla Motors on this, and maybe they are keeping the cards close to them. One can only wonder how many cars are ordered? Do they use the reservation numbers in sequence? In other words, if someone ordered a Tesla model S in HK right now, and got sequence number 1000, would that mean 1000 ordered cars?
I have sequence #114, but somehow I don't think there are 113 orders in front of me. At least the cancellations, but if Tesla Motors have any intention to mask sales, they would try not to make it too easy to reverse engineer statistics.
It is just a proposal at the moment, and they don't normally announce pre-order numbers (just deliveries, and even those only once every three months and for the world - not broken down by region/country/state). They seem to take 'forward looking statements' quite seriously :-O
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