Tesla sales demand plunges, adding to headaches after protest

Tesla Inc.’s growth in China slowed precipitously last month, adding to the company’s headaches after an embarrassing protest at the Shanghai auto show and several headline-generating crashes involving its electric vehicles.

In April, 11,949 China-built Teslas were registered in the country, according to data from state-backed China Automotive Information Net. That’s down sharply from a record 34,714 registrations in March.

A Shanghai-based Tesla representative said in a WeChat message the sequential decline was linked to a two-week adjustment to an assembly line for the Model Y SUV and increasing export volume. The company is accelerating production to get cars delivered to customers as soon as possible.

Separate data that China’s Passenger Car Association released last week showed Tesla sold 25,845 locally made vehicles in April, down from 35,478 units in March. Of those vehicles sold in April, 14,174 units were exported, due in part to demand from the European market, PCA said.

Last month’s slump in local registrations continues a disappointing run for Elon Musk, who until recently enjoyed a dream stretch after breaking ground on Tesla’s Shanghai factory in early 2019. The company received all-important support from the government and overcame tensions between Washington and Beijing.

However, Tesla has attracted unwanted publicity lately, with a disgruntled owner climbing atop one of Tesla’s display vehicles at last month’s auto show and shouting that her car’s brakes had failed, causing a crash. That was quickly followed by two rebukes from government entities that said the EV maker should respect Chinese consumers and comply with local laws.

This week, a traffic policeman was killed and another injured in a crash involving a Tesla. Another incident earlier this month is also still under investigation after a Tesla rear-ended a truck, killing the driver of the EV, according to a Global Times report. The cause of that crash isn’t yet clear.

While hundreds of people die on China’s roads each day, crashes involving Teslas attract intense public interest, with footage quickly going viral on social media.

The slump in April registrations is a reversal from the first quarter, when demand from Chinese buyers helped Tesla report better-than-expected deliveries and another quarterly profit.