Shanghai factory revamp cut Tesla’s China sales last month

• Tesla delivered 28,217 electric vehicles from its Shanghai facility in July, down from June’s 77,938.
• Sales dropped 54% from the previous year.
• Plant updates may enhance manufacturing by 22,000 cars per week, or 30%.

Tesla’s China-made vehicle sales fell 64% in July from a month earlier due to a plant update.

China’s vigorous promotion of electric cars has led to a dramatic decline in Tesla sales.

Tesla (TSLA) delivered 28,217 electric vehicles from its Shanghai facility in July, down from June’s 77,938. Sales dropped 54% from the previous year.

The US manufacturer has only begun recovering from a months-long lockout in Shanghai this year that affected manufacturing and suppliers. Tesla’s Chinese-made vehicle sales hit a record in June.

The CPCA didn’t explain Tesla’s July sales slump, but the US manufacturer acknowledged in its quarterly results call that its Shanghai factory had recently undergone “equipment upgrades”

In July, Tesla reportedly paused most production at its Shanghai plant to work on an upgrade that may enhance manufacturing by 22,000 cars per week, or 30%.

According to Tesla’s quarterly update last month, the Shanghai plant can produce more than 750,000 vehicles annually. After the renovation, the plant may produce more than a million EVs a year, reports say.

“With the Fremont and Shanghai facilities having their highest-ever production months, we’re focusing on a record-breaking second half of 2022,” Tesla stated.

China’s EV sales soar

BYD sold 80,991 pure electric vehicles in July, up 16 percent from June.

Retail sales of new energy vehicles — including electric vehicles and plug-in hybrids — surged 117% in July from a year ago, thanks to government incentives, a rebound in supply chains, and rising EV demand due to higher oil costs, the CPCA said Tuesday.

China has heavily subsidized the development of EVs in recent years.

China’s new energy car sales for 2022 could reach 6 million units, up from 5.5 million. This year’s number would be 70% higher.

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