Tesla and the ‘China profile’

In mid-April, Chinese social media made waves with videos of a woman claiming to be a Tesla customer standing on the roof of one of its cars at the Shanghai Auto Show wearing a T-shirt with a logo on it. print the words ‘Brake failure’.
Security forces immediately surrounded, using umbrellas to prevent people from filming, taking pictures of the girl and posting them on social networks. However, the girl angrily grabbed the umbrellas and threw them away, shouting: “Tesla brake is faulty”.

This person livestreamed right at the exhibition, then went to Tesla’s booth and the incident happened. The girl said her Model 3 car’s brakes failed, nearly killing 4 members of her family in an accident. Tesla has denied the relevant information, but it doesn’t stop there. This is not the only difficulty with Tesla at the moment. The world’s top electric car maker may even be facing one of the worst public relations crises in China, a market investors see as a special feature. crucial to Tesla’s growth momentum. Under increasing pressure to become the focus of criticism from Chinese media and regulators, Tesla is said to be strengthening cooperation with regulators in the mainland and strengthening relationships. with the Beijing government. Tesla’s shift in strategy toward fostering behind-the-scenes interactions with policymakers in Beijing marks a shift from the company’s previous stance, which did not seem to take market failures too seriously. its second largest university (after the US). The changes also take place in the context that China is actively “regulating” many large and powerful private companies, especially technology giants, due to concerns about the risk of domination in this market. A woman protesting on the roof of a Tesla Model 3 electric car at the Shanghai Auto Show in April 2019. Tesla “turns the car”? It is customary for Chinese regulators to discuss policy and industry standards with local and multinational companies, as well as associations and consulting organizations. Attending these meetings has become the norm for many tech companies, but unlike rivals including Toyota Motor and General Motors, Tesla executives are largely absent from closed-door meetings. Instead, Tesla officials regularly speak at high-level conferences. Tesla CEO, billionaire Elon Musk also regularly uses Twitter to comment or criticize China’s regulators or strict rules. However, in the past weeks, Tesla executives have attended at least four policy discussions, with topics ranging from automotive data storage, technology to connect information from vehicles to systems. infrastructure, vehicle recycling and carbon emissions. There, according to officials, Tesla — which is headquartered in California and produces the Model 3 sedan and Model Y sport utility vehicle at a separate factory in Shanghai — made no specific commitments. only participate in the discussion. There are other signs that Tesla – once “sweetheart” – is looking to mend its rocky relationship with Chinese authorities. In two job ads posted on its WeChat account in April, Tesla wanted to find management candidates to update its policy database and maintain relationships with governments and industry associations to ” building a harmonious external environment and supporting Tesla’s business development goals in the regional market.” The exact number of candidates Tesla is looking for is unknown. Tesla Model 3 car. Attack wave A flood of negative news about Tesla in China has increased in recent months. Earlier this year, a Tesla Model 3 was reported to have exploded in a garage in Shanghai, while an article in state media said there were at least 10 reported incidents this year. 2020 about Tesla drivers losing the ability to control their vehicles. In February 2021, the State Market Administration summoned a Tesla representative to request feedback on consumer complaints related to issues such as battery fires, unexpected acceleration, and software update errors. software over the internet. It is reported that China has also recommended the use of Tesla cars to state employees because of the belief that the vehicle’s sensors can record images and location data. In March 2021, Tesla made headlines when the military announced it was “banning” access to Tesla equipment and vehicles from military complexes, citing security concerns with vehicle-mounted cameras. . A few days later, Elon Musk then emphasized at a high-level forum that Tesla would shut down if its cars were used for spying purposes. CEO Musk also sought to defuse tensions in a March speech to state broadcaster CCTV that China’s future “will be great” and that the country will be “the biggest market.” of Tesla. However, the incident at the Shanghai Auto Show and the subsequent reaction of Tesla Vice President Grace Tao was seen as the last straw when, instead of admitting shortcomings, the Tesla and Tesla relationship official The government again questioned the real motives of the above extreme guest. According to Grace Tao, the disruptive woman clearly wanted a high level of compensation and the company didn’t have any reason to pay her. In a post on Weibo, Tesla claimed not to compromise with “unreasonable demands”. State media and government agencies were quick to criticize Tesla. State news agencies flooded Tesla with a series of posts pointing out risks and technical errors, while officials issued warnings. An article in state media titled “Three Lessons for Tesla” warned the California-based electric car maker to respect the Chinese consumer market. The Global Times article emphasized: “The arrogant and overbearing stance that Tesla takes in public is reprehensible and unacceptable, which can seriously damage its reputation and source of the company’s customers in the Chinese market”. Xinhua News Agency and People’s Daily both publicly said that Tesla was indifferent to the interests of consumers. Tesla was criticized for canceling their investment pledges (estimated 14 billion yuan) and tax pledges (about 2.23 billion yuan annually), even failing to meet revenue targets. A wave of attacks, demanding to “evice” Tesla from China is repeating like what Google has faced. Many argue that what is more worrying is that the negative comments are not only appearing on a few articles but are increasingly taking the form of an organized “anti-Tesla” campaign. The involvement of state media makes things worse, because the lesson with Dolce&Gabana or H&M recently showed that Beijing has the right to “bring something up and bury it” when needed. Tesla later issued a statement apologizing for its lack of sensitivity in handling customer complaints. A post on Weibo later said that Tesla was willing to cooperate with the authorities, properly implementing “self-inspection and adjustment” procedures to “fix” customer service issues. Inside a Tesla factory. Beijing’s Power Tesla was once seen as a “baby”, one of Beijing’s efforts to demonstrate that China is allowing more foreign businesses to enter its relatively closed market. The company has been increasing its investment and focusing on the Chinese market over the past two years. With government backing, Tesla broke ground on a major Shanghai factory in 2019 and last year began delivering Model 3s built at the factory to customers in China. Tesla’s China sales have more than doubled in 2020, and the Model 3 is the best-selling electric vehicle in the country. Accounting for about 30% of Tesla’s global sales, China is the automaker’s second-biggest market after the United States and helped Tesla hit a record for first-quarter vehicle deliveries. CEO Elon Musk even had a meeting with Premier Li Keqiang in 2019. However, the success has come with closer scrutiny, especially as many local businesses are also looking for a larger market share in this potential electric vehicle sector. China’s favorable policies towards electric cars have spurred the birth of a number of startups hoping to compete with Tesla such as Nio and Xpeng Motors, although their sales are still far behind Tesla. Simply put, to some extent, Beijing welcomes Tesla’s presence and investment in the electric vehicle market, but still wants the dominance of domestic players in this area. The most prominent in the Chinese electric vehicle market is currently Tesla, SAIC-GM-Wuling Automobile Co. and BYD. Data in March showed that these three giants accounted for 55% of China’s electric vehicle market, but only 5% of the total market share in the country’s auto market, a fact that the electric vehicle market still very young. Hongguang Mini, the SAIC-GM-Wuling Automobile joint venture, has overtaken Tesla this year in terms of sales. Everything will now probably depend on Tesla’s ability to penetrate deeper into China, a market seen as key to Tesla’s global success. The challenge for Tesla now is to make sure it doesn’t take another serious hit in China, where Tesla is poised for more than 40% of its total global deliveries by 2022. China has clearly created favorable conditions for Tesla, the giant in the electric car industry, and now realizes that letting this darling dominate the market may not be in China’s interest. Many companies like Volkswagen and Mercedes have gone through the same thing.