Tesla’s Shanghai factory delivers fewer electric cars as upgrade ahead of new Model 3 launch disrupts production

Tesla’s Gigafactory in Shanghai delivered 12 per cent fewer vehicles in September as the electric-car maker upgraded its mainland China plant ahead of the launch of a revamped Model 3.

“The upgrade of the factory must have disrupted production, hence the decline,” said Phate Zhang, founder of CnEVPost, a Shanghai-based electric-vehicle data provider. “With the delivery of the upgraded Model 3 vehicles, Tesla is likely to see an increase in its sales on the mainland.”

The Gigafactory 3 in Shanghai’s Lingang free-trade zone delivered 74,073 Model 3 and Model Y vehicles in total last month, including exports, down from 84,159 units in August, according to the China Passenger Car Association (CPCA).

That number represented a 10.9 per cent decline from the same period a year ago.

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The Shanghai-based Cailian news agency reported that more than 30,000 Shanghai-made Model 3 and Model Y cars were exported last month, which translated into sales of about 44,000 units on the mainland – a 32 per cent plunge from August.

“All eyes will be on Tesla’s revamped Model 3 since EV sales are expected to be strong in the fourth quarter,” said Tian Maowei, a sales manager at Yiyou Auto Service in Shanghai. “Competition will become fiercer as more Chinese carmakers reduce prices to propel sales.”

Wholesales of all pure electric and plug-in hybrid cars in mainland China – those sold to dealerships – grew about 4 per cent month on month in September, hitting 830,000 units, according to the CPCA.

The country’s top electric-car builders BYD and Li Auto said last week their deliveries had hit a record high.

BYD, the world’s largest EV maker, posted sales of 287,454 units in September, up 4.8 per cent from August, rewriting its own sales record for a fifth consecutive month.

Beijing-based premium EV builder Li Auto delivered 36,060 vehicles in the same month, a 3.3 per cent increase from August, breaking its monthly sales record for a sixth time.

In April, UBS analyst Paul Gong forecast that deliveries of pure electric and plug-in hybrid cars in China would jump by 55 per cent to 8.8 million units this year.

At present, Tesla is the leader in China’s premium EV segment, trailed by Li Auto, Xpeng and Nio, the three start-ups that design and assemble cars featuring autonomous driving technology, sophisticated in-car entertainment systems and high-performance batteries.

In the quarter ended September, Tesla delivered 435,059 vehicles around the globe, up 26.5 on the year and down 6.7 per cent from the previous quarter, missing analysts’ expectations of more than 456,000 units.

The Shanghai factory handed 222,517 cars to mainland and overseas customers between July and September, accounting for just over half of Tesla’s total sales worldwide.

The American giant plans to start delivering its revamped Model 3 this month. It has a longer driving range and will be priced at 259,900 yuan (US$35,674), compared with 231,900 yuan for the previous entry-level edition.

The carmaker began presales of the new model in early September, but did not reveal the number of orders it had received.

The revamped version can go as far as 606 kilometres on a single charge, 9 per cent further than the version it replaces. The suspension has been upgraded, and the rear-seat passengers now get a screen.

South China Morning Post