Tesla’s China Factory Outperforms with 17% Increase in EV Deliveries Amid Slump for Rivals Li Auto, Nio: Government Subsidies Boost Sales

Tesla's electric vehicle production from its China plant has increased by 17%, even as its competitors Li Auto and Nio experienced a decline in sales. The American automaker has managed to defy the overall downwards trend in the first half of the year, likely due to a substantial government subsidy boosting sales.

The Shanghai-based Gigafactory 3, owned by American automobile manufacturer, dispatched 86,697 units of Model 3 and Model Y to both local and international customers in August. This marks an increase of 17% from July and a 3% rise in comparison to the same month last year, as stated by the China Passenger Car Association (CPCA).

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

"Tesla and its domestic competitors have benefited from the Chinese government's financial incentives aimed to stimulate the purchase of electric vehicles as replacements for traditional cars," stated Tian Maowei, a sales executive at Shanghai's Yiyou Auto Service. "With a growing preference for electric vehicles over gas-powered cars among younger drivers, Tesla's sales in China are expected to remain steady in the foreseeable future."

Towards the end of July, Beijing increased the subsidies for electric vehicle purchasers by two-fold. This move came only a quarter of a year following the introduction of incentives aimed at speeding up the transformation of the local car manufacturing sector.