Tesla’s China Factory Outpaces Rivals with 17% EV Delivery Boost Amid Falling Sales for Li Auto, Nio: A Subsidy-Driven Success Story

Tesla's EV production from its China factory has increased by 17%, even as sales for competitors Li Auto and Nio decline. The US automobile manufacturer has managed to defy the industry's negative trend in the first half of the year, largely due to increased government subsidies boosting sales.

According to the China Passenger Car Association, the Shanghai Gigafactory 3, owned by American automaker, produced and shipped 86,697 Model 3 and Model Y cars in August. This figure represents a 17% increase compared to July and a 3% increase from the same time last year, with recipients both in China and abroad.

Even with the recent recovery, the factory's shipments in the initial eight months of 2024 were 6 per cent less than the 624,983 cars it shipped during the corresponding period the previous year.

"Tian Maowei, a sales manager at Yiyou Auto Service in Shanghai, mentioned that Tesla and its domestic competitors have gained from the Chinese government's financial incentives promoting the purchase of electric vehicles as replacements. He added that given the growing preference of young drivers for electric cars over gas-powered ones, Tesla's sales in China are likely to remain steady in the future."

Towards the end of July, Beijing increased the subsidies offered to electric vehicle purchasers by two-fold. This came just three months after introducing incentives aimed at speeding up the shift of the local car industry.