(Bloomberg/Linda Lew) — Shipments from Tesla Inc.’s Shanghai factory increased in September as China’s car market kicks off its busy sales period and automakers start their final push to meet annual targets.
The carmaker shipped 90,812 units from the plant last month, up 2.8% from a year earlier, according to preliminary data released by China’s Passenger Car Association. While the figures don’t split out exports from domestic sales, most of those vehicles will go to customers in China. That marks a reprieve from this year’s trend of declines — Tesla’s wholesale output from Shanghai has dropped in seven of nine months this year.
The bumper month in China contributed to a blockbuster third quarter for Tesla, which last week reported record global deliveries as US consumers rushed to make the most of tax credits for EV purchases ahead of their expiration on Sept. 30.
While it’s unclear if Tesla can continue its sales run in the US, the strong September figure in China signals confidence about demand heading into the fourth quarter, with the Golden Week holiday at the start of October acting as a barometer for the rest of the year. The Musk-led company also started deliveries of a six-seat Model Y sport utility vehicle to attract more family-minded buyers.
Meanwhile, China’s best-selling car brand, rival BYD Co., saw a year-on-year drop for its September sales — the first in more than 18 months. BYD’s deliveries for the full third quarter fell 1.3%, marking the first decline since 2020. Still, the Shenzhen-based manufacturer has outsold Tesla in the pure EV market for the past four quarters.
Chinese authorities are attempting to rein in what they describe as unhealthy competition in industries from automobiles to solar panels. For the EV sector, the long-running price war that’s seen the rise of homegrown giants like BYD has also pushed smaller carmakers to the brink and squeezed margins along the supply chain, raising concerns about quality.
Beijing has called on automakers to stop unreasonable price cuts and to pay their suppliers and dealers quicker, which has so far had limited effect. With discounting discouraged, manufacturers may have trouble hitting annual sales targets just as China’s economy is slowing and consumer sentiment remains fragile.
China’s total sales of EVs and hybrids amounted to roughly 1.5 million last month, up 22% compared with the same time last year, according to data from PCA.
–With assistance from Vlad Savov.
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