The interesting reason a Tesla Model S costs only 50% more in China

Tesla has announced the pricing of its Model S for affluent Chinese EV car enthusiasts. How Tesla arrived at its price point and why US Tesla’s customers may care.

Publicly traded Tesla has just announced that it will be selling the Model S in China for less money than it could get, because it cares about the Chinese consumer and wants to do the right thing, rather than maximize profits. Tesla has a long waiting list of US customers for Model S electric super-sedans. Depending upon which interview you watch, Elon Musk will say it is someplace in the area of three months for the base model and "Priority Delivery" for the fancy $120,000 version is a little bit quicker because money can buy you a faster delivery.

So stepping back for a moment, here we have a publically traded, US-based manufacturer, which used a US government loan to start operations, with a huge backlog of American buyers, who just announced “This pricing structure is something of a risk for Tesla, but we want to do the right thing for Chinese consumers. If we were to follow standard industry practice, we could get away with charging twice as much for the Model S in China as we do in the US.” The general buzz so far is that Tesla owners and fans (not so sure about institutional stock investors and the SEC) think this is a great idea. Tesla clearly knows its base.


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I'm getting some odd Facebook comments regarding this story. I think people assume from the headline (which is accurate) that Tesla is charging 50% more for the car in China. They are not. They charge exactly the same for the car. Read the story for the details.
Just asked about wait time on most popular trim line at the Norristown Pennsylvania location. They said 3-4 weeks from order to delivery.
This is one of those stories I keep in the category of, "The world is crazy."
Brian, thanks very much. I think Elon's comments from last week are to "Under-promise and over-deliver." In fact, when I drove the model S this past summer at a Tesla store there were models for sale from stock. Thanks for reading and commenting.