(NASDAQ:TSLA), the California-based electric luxury sports car company founded by Elon Musk, has often said that China will be critical to the company's growth, though Musk has been vague on plans for entering the Chinese market. As such, progress has been slow: A flagship showroom in Beijing, which would have been the first on China's mainland (there is a showroom in Hong Kong) had to be put on hold earlier this year due to a trademark issue
; the company began taking reservations in China for the Model S in August and still has not started shipping vehicles.
However, it looks like the company just sold its first car in the country. According to the Qianjiang Evening News, a 24-year-old man from the city of Donyang in China's eastern Zhejiang province, has bought the first Tesla Model S in China. It was shipped to him from Tesla's store in Hong Kong. It was said to cost him 2.5 RMB, the equivalent of $410,000.
Reportedly, the man owns his own luxury car rental business. On October 14, he posted pictures of his new car on his blog
Now, $410,00 is obviously a lot higher than the going price for a Model S in the United States, where the cars range from $71,000 to $96,000 and drivers can further reduce their costs through state subsidy programs. When the car becomes available for the mass market in China, it won't go for $410,000, but it still won't be cheap.
According to CarAdvice, the entry-level Model S will start from HK $600,000, or the equivalent of $80,000. When you add in Chinese tariffs on imported cars that go as high as 25%, a value added tax of 17%, and an additional consumption tax, the Model S could end up costing as much as 1 million RMB, which is $160,000 USD. Putting the icing on the cake, as Bloomberg reported, China will only offer up to 60,000 RMB, or $9,600, in government subsidies. That's less than half of what customers get in rebates in California.
In general, electric cars have struggled in the Chinese market: Of 18 million total passenger cars sold in 2012, only 22,000 were plug-in electric, according to LMC Automotive. Additionally, only 168 public charging stations currently exist in the country.
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