Tesla’s price cut ignites anger among Chinese buyers

By Li Xuanmin Source:Global Times Published: 2019/3/3 16:48:40

Tesla buyers put banners at a store in Changsha, capital of Central China's Hunan Province over the weekend. Photo: Courtesy of Luweijuzi

Tesla's recent move to cut the selling prices of eight models has drawn strong criticism from Chinese buyers. While some users said on social networking platforms that "buying an electric car is even more thrilling than purchasing stocks," a few buyers also reportedly put up banners at the electric carmaker's stores to protest the price cuts, which they claimed had "infringed consumers' legal interests."

The move could also affect Tesla's sales in China this year, as some may adopt a "wait-and-see attitude" in the belief that further price cuts would be announced soon, industry insiders said.

"I received Tesla's Model X on February 25, and I only drove this car for five days before Tesla announced a price reduction of 174,300 yuan ($25,989.87). I'm probably the most unlucky new buyer ... That's unfair," a Weibo user named Luweijuzi complained in a post on his account.

The new buyer claimed that his actual loss because of the price cut was about 200,000 yuan, including tariffs, bank loan interest, insurance and sales taxes.

Tesla announced on Friday price cuts of 11,300 yuan to 341,100 yuan on eight models including Model 3, Model S and Model X. CEO Elon Mask said later on Twitter that if someone had bought a Tesla before the price cuts, they could have "Autopilot or full self-driving at half the normal price."

But the offer was far from enough to quash Chinese buyers' anger.  

"It's a good thing to cut prices, but have you considered the feelings of those buyers who paid before February 25?" a user who identified himself as being among the first batch of Chinese owners of Tesla's Model 3 said in a post in industry forum autohome.com. The first shipment of Model 3 cars arrived in Shanghai on February 22, and customer deliveries begin at the end of February, media reports said.

"Two policy changes within a month, Tesla is going to play itself into a dead end," a netizen aw7phf6c8 said in a message on the forum. Another netizen also joked that "buying a Tesla is more thrilling than buying stocks."

Meanwhile, a short video showing Tesla buyers posting banners in a Tesla store in Changsha, Central China's Hunan Province, to protest the price cuts went viral on Chinese social networking platform Weibo. The banner said "Tesla cut prices on its own will, hurting the legal interests of consumers."

It is not clear whether Tesla will offer other measures to compensate those new buyers. The company had not responded to an interview request by the Global Times as of press time.

Feng Shiming, a car analyst at Shanghai-based Menutor Consulting, told the Global Times that Tesla's "frequent, simple and rude" price cuts show that the company is not doing a good job in studying the psychology of Chinese consumers, and the move will take a toll on its performance in China. For example, price-sensitive buyers could delay their decisions and wait for its local production of the Model 3 in hopes of a further price cut. 

"From a legal perspective, Tesla could do that. But it has hurt its image among Chinese buyers," Feng added.

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