Tesla has started delivering its locally-produced Model Y crossovers in China, marking another milestone for the electric carmaker in the world’s largest vehicle market. The deliveries began on January 18, 2021, in 10 major cities at once, including Shanghai, Hangzhou, and Wuhan. The Chinese market is critically important to Tesla and its growth plans, as the company aims to increase its vehicle sales volume from about 500,000 in 2020 to 20 million annually over the next decade.
Tesla’s Production in China
Tesla built its $2 billion Shanghai plant in just under a year, a rapid timeframe for the global automotive industry. Automakers establish local vehicle production to lower shipping costs and avoid import duties or delays, especially in countries with high tariffs like China. Tesla has said that the initial goal for the Shanghai factory is to make 250,000 cars a year, before ramping up to 500,000 units. The debut of the Chinese-made Model Y has been hotly anticipated, with the launch seen as another challenge to Chinese rival Nio, which sells its own line of electric SUVs.
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Tesla’s Strategy for Model Y in China
Unlike previous vehicle programs, which were launched in different markets with vehicles imported from Tesla’s Fremont factory in California, Tesla is only introducing Model Y in new markets once the vehicle is produced there. For the past nine months, Tesla has been expanding Gigafactory Shanghai to prepare for the production of the electric SUV. The plant has more than doubled in size. In October 2020, Tesla obtained approval for Model Y made in China from the Ministry of Industry & Information Technology. Finally, Tesla started production of the Model Y at its Gigafactory in Shanghai over the last few weeks. Just last week the automaker updated the online configurator with the production version – confirming that deliveries will start this month.
Tesla’s Updated Model Y in China
On October 1, 2023, Tesla updated the Model Y in China. It made changes to the exterior, interior, and a few select specs. The new Model Y is equipped with an RGB ambient light on the dash. It also comes with a new textile dashboard material (replacing the wood trim). According to reports from China, the new MIC Model Y is also equipped with the Hardware 4.0 (HW4) self-driving computer and brings some other improvements (NVH reduction). The pricing of the three MIC Tesla Model Y versions in China remains unchanged and starts at $36,788 (263,900 CNY).
Final Words
Tesla’s new Model Y has started delivery in China. The company is using a new vehicle introduction strategy for the electric SUV. Tesla’s production in China is critical to its growth plans. The Chinese market is predicted to become even more crucial in the coming years. Also, the debut of the model made in China has been hotly anticipated. The launch is seen as another challenge to Chinese rival Nio. Tesla has also updated this model in China, applying changes to the exterior, interior, and a few select specs.
