Name: Why China Loves Tesla
Uploaded: 2020-05-20T02:13:10.000Z
Duration: 6 min 14 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

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Narrator: Although Tesla is based in California,

China seems to be where it's found its biggest supporters.

In 2019, the company saw its China sales increase

Despite the recent pandemic that saw Chinese car sales

decline by 42% for the first quarter of 2020,

Tesla bounced back immediately with record-setting months

But Tesla's successful run in China hasn't come

without plenty of help from tax exemptions on sales

to billions of dollars in funding for the construction

First, we have to go back to how Tesla got there.

As Tesla saw its China sales triple to $1 billion for 2016,

it became clear the EV builder had an audience there.

However, as other automakers had already found,

the US trade war with China was a major obstacle

With heavy taxes being slapped on Teslas imported to China,

an $80,000 Model S from the US was selling

The only way to sell cars to Chinese consumers

on a larger scale would be to build them there.

But the cost of producing cars in China was not cheap.

Government policy forced foreign automakers

to work with a joint venture partner in China

However, in 2018 the country began rolling back

Elon Musk was quick to take advantage and that July,

signed an agreement to build a wholly owned factory

With $1.6 billion in funding from Chinese banks

and record-fast approvals by the government,

Musk constructed Tesla's third gigafactory.

By August 2019, the plant was already building vehicles.

The factory is currently making 3,000 cars a week

By the end of 2021, when the factory is fully operational,

Musk plans for it to be churning out 500,000 cars annually.

And with China now exempting Model 3s from a 10% sales tax,

there's no telling how many the EV giant stands to sell.

So why has Tesla received such a warm welcome from China?

To start, there's the incredible amount of money

China stands to make off the factory alone.

The Shanghai facility was financed almost entirely

who can expect a pretty big return on their investment,

plus, Tesla purchased a 50-year lease of the land,

which is money that goes directly to the government.

On a wider scale though, Tesla could be the boost

In 2019, total car sales in China fell by 8%,

More recently, factory closures due to COVID-19

had disastrous effects on this year's first quarter sales.

However, the industry is steadily recovering,

largely due to EV sales with Tesla accounting

With sales already improving in both March and April,

Despite adding competition to China's enormous EV market,

that were once dubbed "Tesla-killers" are now struggling.

While they are some of the most recognized

they are virtually unheard of in the West.

A well-known international brand like Tesla

could help introduce the country's EV industry

to global market competition, giving them exposure

and some of the world's most heavily polluted cities,

is doing everything it can to prioritize EVs.

For Chinese consumers, electric cars are cheaper

to register and they're significantly more convenient.

As of 2016, at least a dozen major Chinese cities

Under these conditions, traditional vehicles

with license plates ending in an odd digit are allowed

on roads on odd dates and those with an even digit

EV drivers can take their cars out on any day.

By 2025, China aims for EVs to account for 25100:05:13,170 --> 00:05:14,960 of all cars sold,

with Tesla potentially leading that charge.