Tesla risks being relegated to expensive niche as it fails to strike a deal in China
Hong Kong — Tesla, the biggest-selling electric car (EV) maker in the US, is in danger of being relegated to an expensive niche in China because CEO Elon Musk cannot clinch a deal to open a factory there. More than seven months after Tesla said it was working with Shanghai’s government to explore assembling cars, an agreement has not been finalised because the two sides disagree on the ownership structure for a proposed factory, according to people with direct knowledge of the situation. China’s central government said the plant must be a joint venture with local partners, while Tesla wanted to own the factory completely, the people said, asking not to be identified because the negotiations are confidential. Currently, all foreign car makers must partner Chinese companies in order to manufacture locally. Tesla’s sluggishness in starting local manufacturing means it is fumbling a chance to capitalise on China’s hard sell for new-energy vehicles, including EVs, plug-in hybrids and fue...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.