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    Love hate Tesla: cut the price to close the store Is this Musk's rush or big move?

    2019-03-10 18:58:16

    Chinese entrepreneurs love and hate

    "Mr. Liao is deflated."

    On March 2nd, a WeChat sent by Tesla to Mr. Liao of Hunan wrote that as a front-end salesperson, he could not control the company's policies and direction. “We are also the “executors”.”

    Mr. Liao ordered a ModelX on January 11. At that time, the sales force advised that the tariffs also dropped. The US port has a quasi-current car, which is the last one in the country. Mr. Liao brushed the card in ten minutes and settled 100,000 yuan.

    On February 25th, Mr. Liao successfully picked up the car. After only five days, he saw the news of Model X official dropping 174,300. He found the Tesla sales question and the other told him that he could buy a fully automated driving package for 50% off in order to make up for the loss. But Mr. Liao did not agree.

    He calculated an account, affected by price cuts, plus tariffs, purchase taxes, bank loan interest, insurance and other expenses, he actually lost more than 200,000. He thought that if the delivery was not so smooth at the time, "I can save two Rolex money one or two days later."

    On March 1, 2019, Tesla China announced a price cut, which triggered the rebound and controversy of the old owners. Mr. Liao is only one of the cases.

    "On Sunday, March 10, 2019, at 2 pm, Venue: Tianhuan Square, Guangzhou Tiantian District, and now signing up for Solitaire..." On March 9, Teslawe's rights group launched a new dynamic of rights. This is an “organized and premeditated” activist activity to persuade the owner of the car who wants to buy a car and give up buying Tesla. "I don't regret it (buy a car), but I feel like I am pitted," said a rights owner.

    Behind the price cut, the Chinese road that reflects Tesla is welcoming more variables. According to Tesla's 2018 annual report, China is the second largest consumer market in Tesla. In 2018, China's revenue was 1.757 billion US dollars, down 15.4% year-on-year.

    In the eyes of industry professionals, a sharp price cut will affect Tesla's user loyalty. At the same time, the pressure of loss brought to the company by price cuts cannot be ignored. In 2018, Tesla achieved revenue of $21.46 billion and net loss from $2.44 billion in 2017 to $1.063 billion.

    To this end, on March 1, Tesla announced a new round of cost reduction and efficiency measures, turning offline sales channels and closing some stores. "Combining all online sales with continued cost efficiency will enable us to reduce the average price of all vehicles by about 6%, allowing us to achieve the $35,000 price of the Model 3 model earlier than expected."

    "The price cut is ultimately to gain more market share." New Era Securities chief analyst Kai Wenming told "Chinese Entrepreneur."

    Price cut offensive

    In the round of the all-round model price reduction on March 1, 2019, the price cuts of Model X and Model S were the most severe. The price cut range of Model X is 174,500 yuan - 341,100 yuan, and the price range of Model S is 11,300 yuan - -27,500 yuan. Model 3, which has just landed in the Chinese market, has a price cut range of 26,000 yuan to 44,000 yuan. A Tesla salesperson at the Overseas Chinese Fufang Grassland Store told China Entrepreneur, which is the lowest price in history after Tesla entered the Chinese market.

    Such a price cut caused the old car owners to rebound sharply. Mr. Liao and the newly arrived Tesla rider went to the Tesla direct store in the Wharf International Financial Center in Changsha. The companion made a banner and he found a TV station. After friendly consultations, the staff asked them to pull the banner apart - because it would be photographed and sent to the headquarters for feedback. The black-and-white banner spread around the Tesla storefront, and it was circulated. The banner reads: Tesla arbitrarily cuts prices and infringes consumer rights.

    In this regard, Tesla sales also feel aggrieved. “Before (refer to March 1st) price cuts really brought us bad influence,” BeijingFinancial streetThe sales of the shopping center told the "Chinese Entrepreneur". After the situation was fed back to the headquarters, the headquarters sent an e-mail saying that even after the tariff was lowered, the Model 3 would never adjust the price.

    In fact, Tesla's price cuts were not long from the last price adjustment. During the Chinese New Year, there was a policy in China that purchased the Model 3 and the AutoPilot assisted driving function was given free of charge. It is said to be worth 70,000 yuan. The offer has now stopped. Earlier, in late November 2018, Tesla China also announced that it would bear some tariffs on Modle S and Modle X, and cut prices by 12%-26%.

    The price cuts are “injured” by old users, and there are also new users who come here.

    On the afternoon of March 9th, when the reporter visited Tesla's Teslamen store in Beijing Financial Street Shopping Center, the scene was crowded, and there were testers in the Model X and Modle 3 parked. Two small compartments and corners of the store. The small round tables are available for sale and customers. However, price cuts may be only one of the reasons. On-site sales told this magazine that since the listing of Modle 3 in China, there have been many stores.

    Channel change

    On March 6th, a screenshot of a message from a senior Tesla China sales complaint company was revealed. Screenshots show that Tesla China is expected to cancel the first-line sales commission in the second quarter of this year.

    A person close to Tesla sales said that Tesla sold a base salary of more than 9,000 yuan, and the welfare was good. The commission was 300 yuan per car. This statement failed to be confirmed by Tesla sales. The "Chinese Entrepreneur" reporter inquired about a number of sales, and did not confirm the reply to the statement that the commission was cancelled in the second quarter. One salesperson said that if it is true, there should be a lot of people leaving in the second quarter, and they will be one of them. From three shifts from morning to night, she described Tesla's sales work as "tired and tired", but also very fulfilling.

    The new development is that on March 8, foreign media Electrek quoted sources as saying that Tesla has closed 29 offline stores in the US and Canada; but sales staff have been told that the company will suspend the store before the end of this month. And the process of layoffs.

    On March 7, the reporter visited Tesla Chaoyang Joy City Store and found that only one security guard supervised the scene. It is reported that recently, the store sales have all been transferred to the Huamao Tesla store office.

    One of the sales of China Trade Tesla Store told China Entrepreneur that in Beijing, Tesla Chaoyang Joy City Store and Yizhuang Store are expected to close. The news was not officially confirmed by Tesla.

    Will the reform of Tesla's sales channel and the closure of direct-sale stores also lead to the new forces of Chinese car-making? For the Chinese market, many industry insiders believe that because of the purchasing habits of Chinese consumers, the possibility of changes in China's sales channels is small.

    "Tesla's online sales do not mean the negation of the "line store" rationality." Ding Qingfen, chief affairs officer of the company, Tesla believes that Tesla can succeed in the United States and the world, in addition to leading products. The offline experience store played an important role. At present, Baytone is in the stage of establishing market awareness and accumulating market share from scratch. It is necessary to establish direct and efficient consumer contacts. One of the most important aspects is the offline experience store.

    Domestically

    If price cuts and channel adjustments are Tesla's considerations in terms of competition and cost, then the localization process means that Tesla's identity in the Chinese market has also ushered in a turning point.

    On March 6, Chen Mingbo, deputy of the National People's Congress and director of the Shanghai Economic and Information Committee, said in an interview with the media that the Tesla project is the largest foreign investment in manufacturing in Shanghai. It was only used for signing, taking land and starting construction last year. Half a year, fully reflects the speed of Shanghai. It is expected that the construction of the assembly shop will be completed in May this year, and some production lines will be officially put into operation at the end of the year.

    According to the plan, the initial planning capacity of the Shanghai Super Factory is 250,000 vehicles and battery PACK, which will gradually increase to 500,000 in three years. In addition, the plant will also produce a new model, the Model Y, which will be released on March 14.

    But whether the Tesla Shanghai plant can be mass-produced by the end of 2019 depends on a number of factors, such as civil engineering, local supply chain construction, and policies and regulations.

    Weibo-certified car blogger “Television Principal” recently visited the Tesla Shanghai factory and communicated with the on-site construction personnel. It was learned that after the seventh day of the Lunar New Year, the factory site was officially started. The on-site construction time was 7×24h around the clock. The factory acceptance time is about July-August.

    Local supplier selection is not easy. Open civilization tells this magazine, in the field of non-three electricity, Tesla and includingXusheng shares,Sanhua ZhizhiOther Chinese companies have established cooperative relationships. Previously, Reuters had quoted two people familiar with the matter as saying that Tesla had signed a preliminary agreement with Tianjin Lishen, which will supply batteries to the Shanghai plant. However, the news was later denied by both Lishen and Tesla. At present, Tesla's exclusive battery partner is Panasonic.

    “Contact is definitely in contact. On the one hand, Tesla needs to find a localized supporting enterprise. On the other hand, Tesla needs to find more suppliers.”Chinese ChemistryLiu Yanlong, secretary general of the Physical Power Industry Association, said, "If you choose to import from the United States, a large number of batteries, one is the cost, one is the safety risk involved in the transportation process, can not be air transport, can only be shipped, the time will be very long ""

    In addition, the issue of funding has always been an important issue for new vehicles such as Tesla.

    On March 8, Tesla filed with the Securities and Exchange Commission (SEC) that its subsidiary had been on March 1st with a batch.Bank of ChinaA one-year loan agreement with a total amount of no more than 521 million US dollars (about 3.5 billion yuan) was signed for the construction of Tesla's Shanghai Super Factory. The documents show that the loan comes from China Construction Bank Corporation (Shanghai Pudong Branch), Agricultural Bank of China Limited (Shanghai Branch), China.ICBCCo., Ltd. (Shanghai Branch) andShanghai Pudong Development Bank.

    After the domestic production of Tesla, how will it stir the Chinese auto market?

     

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    Editor in charge: Zhang Zhenjiang

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