BEIJING, June 6 (Xinhua) — With Tesla’s Shanghai super plant putting in production, the company plans to double the number of repair and maintenance stores in China, adding about 100 charging stations and revamping its showrooms. However, the moves are a departure from what Elon Musk, Tesla’s chief executive, announced in March, when he said the company would close many retail stores around the world to cut costs.
Indeed, Tesla has differentiated China, the world’s largest market for electric vehicles, from the rest of the world.
“Making cars from the Shanghai plant is only the first step,” Tao Lin, Tesla’s global vice president, told an industry conference in Beijing last month. “Next, we have to deliver the car well to our customers and provide very good after-sales service.
Tesla plans to turn some of its showrooms in China into one-stop shops, known as the Tesla Center, as well as providing maintenance support as a delivery site, two sources said. They say the project will start in Shanghai and Guangzhou.
In the coming months, Tesla also plans to double its number of service centers from 29 to 63 and increase the number of fast charging stations by 39 percent to 362, according to Tesla planning documents.
“Expanding the service network is very important to boost customer confidence,” said Wang Hao, Tesla’s general manager for China. He also said Tesla would build more charging stations in China next year “at a faster pace.”
To boost its presence in China, the carmaker has begun trial production at its Shanghai plant. The Shanghai plant, with a $2 billion investment, will be mass-produced by the end of December.
Tesla has said it should be able to produce 3,000 Model 3 cars a week in the early stages. That’s almost four times the monthly monthly sales of Model 3 cars imported in China this year, according to LMC Automotive, a research firm.
However, the expansion plan is likely to add to the financial pressure on Tesla, which has been burning money because of huge losses and capital spending. It’s unclear how much Tesla will need to expand its sales and after-sales network in China.
Tesla operates about 48 showrooms in mainland China. By contrast, BMW, Daimler’s Mercedes-Benz and Audi will launch electric SUVs in China by the end of the year, each with more than 500 outlets.
Experts say that while Tesla may not need to have as many showrooms as its competitors, it should have more than it does today.
Cui Dongshu, secretary-general of the China Passenger Vehicle Association, said: “Chinese consumers are willing to test cars in brick-and-mortar stores, so carmakers need to have a certain network of stores everywhere. “
For Tesla, which maintains its momentum in China, its revenue in the U.S. fell 39 percent in the third quarter, its first decline in more than two years. By comparison, sales in China rose 64 per cent to $669m.
Tesla is also expanding its sales and delivery teams in China: job ads posted on social media show that it has held several sales and delivery recruitment events in Shanghai, Beijing and Shenzhen in recent months.
At a Tesla service center in Beijing, customers say more maintenance and charging facilities will encourage them to travel further.