Shanghai--Serial entrepreneur Elon Musk has launched spacecraft into orbit, but popularising his Tesla electric cars in China is proving to be tougher than rocket science.
PayPal billionaire Musk -- co-founder and chief executive officer of Tesla as well as chief of rocket maker SpaceX -- visited China last month, and admitted sales in the world's largest auto market were below expectations.
"China is the only place on Earth that we have excess inventory," Musk told Chinese media, blaming "speculators" for ordering cars amid the early media hype and then not taking delivery.
When China's premier auto show opens on Monday in commercial hub Shanghai, Tesla will be among the 2,000 exhibitors vying for the eyes -- and wallets -- of the massive market.
China is the world's biggest polluter, but analysts say electric vehicles face key challenges: consumer reluctance due to perceived problems with safety, reliability and access to charging facilities.
Tesla has never announced sales targets for China, but the launch of its cars generated widespread media coverage and an enthusiastic initial response.
Now, though, it has more than 2,000 unsold vehicles, according to Chinese media reports, and confirmed last month that it was cutting jobs in the country.
"Elon Musk and his team had a very limited understanding of the China market," said Professor Gong Yan of the China Europe International Business School.
"The fanatical reaction at the time caused a misjudgement of the China market by his team. For example, sales targets were raised too quickly," he said.
To help sales, Tesla is giving every buyer a free charging device and free access to its mainland China network of more than 50 "supercharging" facilities -- the equivalent of a petrol station, although they take an hour to do the job.
Beijing is keen to promote the use of "new energy" vehicles, out of both concerns over pollution and as part of a broader policy to build up the domestic auto industry.
AFP
