Tesla Inc. established a brokerage in Shanghai that will offer auto insurance to Chinese buyers.
The brokerage, with registered capital of 50 million yuan ($7.2 million), is wholly owned by Tesla’s Hong Kong subsidiary, according to Tianyancha, a Beijing-based website that tracks registration information of Chinese businesses.
The legal representative of the insurance brokerage is Zhu Xiaotong, a global vice president at Tesla, who is in charge of the U.S. electric vehicle maker’s operations in the greater China region.
Additional information about the brokerage was not available.
The EV maker has begun offering auto insurance in California, where rates are generally high and a deterrent to Tesla ownership, the company has said.
It also plans to offer insurance that taps internal data from its AutoPilot driver-assist system to help reduce rates.
Analysts say Tesla could offer lower insurance rates because AutoPilot will decrease the frequency of collision claims. The automaker would have a better determination of how safe drivers are based on how often they use AutoPilot and could adjust rates more easily than other insurers.
Tesla started assembling the Model 3 sedan at its Shanghai plant in January. The factory is due to launch output of the Model Y in the first quarter of 2021.
In the first seven months, Tesla delivered 61,352 vehicles in China, according to China Passenger Car Alliance, a data unit of the China Automobile Dealers Association.