Biplab Das 
Tesla, the U.S. automaker, experienced a decline in sales of China-made electric vehicles (EVs) in April, according to data from the China Passenger Car Association (CPCA). The figures showed that the company sold 62,167 EVs of Chinese origin in April compared to the decrease of 18% to the same period last year.
Concerns and market reaction
The news of Tesla’s sales decline led to a 3.8% drop in its shares on Tuesday. This downturn was due to fears of disappointing sales for Tesla EVs because of rising competition especially from the Chinese EV producers. Last year, Tesla’s China-produced vehicles accounted for more than 50% of its global deliveries, faced challenges amidst an intensifying price war in the Chinese EV market.
Deliveries of Tesla’s China-made Model 3 and Model Y vehicles saw a significant decline of 30.2% compared to March, further highlighting the challenges faced by the automaker in the Chinese market.
Contrasting trends in the EV market
Although Tesla encountered sales depletion, the whole Chinese EV market did not let its speed decrease even if it was not as significantly as it was already previously. During the past April, the sales of new-energy vehicles, including battery-powered EVs or plug hybrids, showed an estimated 33% increase over the previous year and were estimated at around 800,000 units.However, this figure represented a 2% decrease from the previous month.
Rise of Chinese rivals
Tesla faced tough competition from Chinese automaker BYD, which reported robust sales figures for April. BYD’s Dynasty and Ocean lineups of EVs and plug-in hybrids recorded a 48.97% year-on-year increase in sales, with a 3.5% rise from March. This performance further underscored the growing dominance of domestic players in the Chinese EV market.
Tesla’s global performance and strategic moves
The increasing difficulty for Tesla regarding its China-made EV sales is presented in the context of a larger problem. In the report for the first quarter of Tesla’s operations, there was a global decline of vehicle delivery for the first time in years that almost four years saw. Sales of China-made vehicles also saw a 4% drop during the January to March period compared to the previous year.
Being faced with the competitiveness issue, Tesla, in response, has found and implement the strategy that includes a workforce layoff and vehicle price reductions in the main markets of the USA, China, and Europe. Besides, Elon Musk, CEO of Tesla, went to China in late April to promote sales of the company’s new advanced driver-assistance package in the country, which is intended to increase its competitive advantage over local manufacturers.
