Tesla Model S 85 kWh “Fairly Priced” From $121,000 In China

JAN 23 2014 BY ERIC LOVEDAY 45

Tesla Motors has finalized pricing for the Model S in China.

Gone is the 60 kWH Version in China - Your Choices Are Limited to 85 kWH and P85 Versions of the Model S

Gone is the 60 kWH Version in China – Your Choices Are Limited to 85 kWH and P85 Versions of the Model S

Before we get down to the numbers, let us first point out that Chinese buyers have only two versions of the Model S to choose from:

  • 85 kWh
  • P85

Absent is the base 60 kWh Model S.  Tesla makes no mention of nixing the 60 kWh version of the Model S in China, nor does the automaker say a word on whether or not the 60 kWh Model S will be offered in China at a later date.  For now, Chinese buyers can choose from only two 85 kWh versions of the Model S.

Tesla Website China

Tesla Website China

Now, we’ll move on to price.  Here’s the press release/blog post put out by Tesla Motors regarding Model S pricing in China:

A Fair Price

Tesla Model S China

Tesla Model S China

By The Tesla Motors Team

Today we’re launching the Model S online design studio in China and announcing the price of the car. For Chinese customers, the price of the Model S with the premium 85 kWh battery pack is 734k CNY.

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. But we’re doing things differently, even if it means that some people might look at the price and mistakenly think it must somehow mean the Model S has less value than its competitors.

Given that the Model S won the 2013 Motor Trend Car of the Year award, received the highest rating of any automobile in history from Consumer Reports (99 out of 100) and achieved the best possible US National Highway Traffic Safety Administration rating, that is certainly not the case.

Here's the Price Tag for a Fully Optioned Model S P85

Here’s the Price Tag for a Fully Optioned Model S P85

Instead, the price of a Model S in China is much lower than its competitors simply because we want to treat our Chinese customers just as well as we’d treat customers in any other country. That means the price of a Model S in China is the same as the price of a Model S in the US, adding only unavoidable taxes, customs duties and transportation costs. We’re not even factoring in the cost of the free-to-use Supercharger network that Tesla will build across China.

734k CNY is a big risk for Tesla. We know it’s unconventional. We know we could charge more. We know that our competitors will try to convince Chinese consumers that our relatively lower price tag means the Model S is a lesser car, when the real reason their car costs more is that they make double the profit per car in China compared to the United States or Europe.

But we decided to take a chance anyway.

We care about fairness, and we care about transparency. We care about advancing the cause of electric cars in China. And we care about doing the right thing for our customers – no matter where they live.

– The Tesla Motors Team

Tesla breaks down the 734,000 CNY price as follows:

$81,070 US price
$3,600 Shipping & handling
$19,000 Customs duties & taxes
$17,700 VAT
734k CNY @ 6.05 exchange rate

That 734,000 CNY figure works out to $121,288 at today’s exchange rate.

That may sound expensive, but it’s not when you consider that the Chevrolet Volt is currently offered in China at a price of 498,000 RMB, or $82,291 USD at today’s exchange rate.

In the US, the 85 kWh version of the Model S is approximately twice the price of the Volt.  That’s not the case in China though.

We suspect Tesla will sell an ample amount of Model S sedans in China with this “fair price” being set.

To build /order your own Model S in China, visit Tesla’s design studio by clicking this link.

Chevy Volt in China

Chevy Volt Ad For China

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45 Comments on "Tesla Model S 85 kWh “Fairly Priced” From $121,000 In China"

newest oldest most voted

I wonder what happened to the special rear seats they wanted to do for the chinese market. They we’re planning on doing that because rich chinese ppl like to get driven around on the rear seats and thats certainly not a highlight of the standard Model S.

Jaime

What kind of socket use, european socket (Mennekes) or US socket for charger?

MDEV

China use 220V AS 3112 European style plugs work too.

Dan Frederiksen

If china doesn’t soon drop that import tax and stop ganstering carmakers into starting national manufacture I say we take back production and leave them to their own devices.
Maybe ironically have the chinese produce the robots that take away their work.
competing with a robot’s salary is a losing battle so all we have to do is be smart. Oh.. I see a hole in the plan.

Mikael

Car manufacturers staying outside the worlds largest market and one that will be 2-3 times larger than the seceond largest market in just 10-20 years. Yeah, right….

And when it comes to “gangstering” or rather protectionism then the US and Germany have been doing it for ages so why shouldn’t China be able to do the same?

sven

What was the point of admitting China into the World Trade Organization in 2001 if they can still use such tactics in 2014? Why doesn’t China have to sign any Free Trade Agreements? Why can China favor domestic manufacturers by arbitrarily limiting the export of rare earth minerals?

Mikael

These things are nothing new and is applied by both the EU and US whenever they want to. Like when the EU decided that solar panels from China suddenly should get extra taxes because they were killing local solar companies.

And why shouldn’t they have the possibility to limit their export? Why shouldn’t they be able to sell to anyone they want, including just selling it inside the country.

And it’s not like the US or Europe have free trade agreements with every country in the world.

I can’t say that I always agree with the tactics but I don’t find them strange either since it’s the way EU and the US have shown us how it’s done and still do. They have played by their own rules for a long time and can’t really get upset by China doing the same thing.

Why can the US put an embargo on a country like Cuba? It’s hardly fair either…

Last I checked, the US didn’t require foreign companies to partner with US companies in order to build here.

Only country that makes China look bad is Japan.

(Cuba? Really?)

abhishekifmr

WOW.. what a pricing..
BMW 6 , Audi 8 & Merc 250 is 1 million + Yuan. Certainly TESLA is seeing China as a big big market 🙂
http://www.chinadaily.com.cn/business/motoring/2013-08/28/content_16927605.htm

DaveMart

They have also managed to hit the competition where it hurts, and throw into doubt current high prices and with them large profits.
None of the big three German luxury car makers will be thrilled about that source of profit being endangered, but they may have no choice but to cut prices, even if relatively few Teslas are sold.

Nelson

If I were Elon Musk I would say to China:
You want me to sell Model S there? Drop the ridiculous import tax.
The Model S is transportation that keeps your air clean and your fuel funds from going to other countries.

High import tax, No Car!
Someone needs to stand up to that Government for the sake of their people.

NPNS!
Volt#671

DaveMart

What in the world are you talking about?
Every other Government taxes imports where it feels like it, and the US is far, very far, from being the exception to that.

Nelson

Oh that’s right I forgot if Tesla did what I stated the Chinese would just go ahead and buy that other EV that gets 265 miles of range from that other auto company that is also installing Supercharging stations with “free for life” charging.

NPNS!
Volt#671

DaveMart

China will never survive without the Tesla, apparently.
But oddly, Musk feels that they need the Chinese market to hit the volume targets he needs.
You have singular ideas about the power structure of this relationship.

Mikael

It’s the second largest luxury car market. The top 3 are the US, China (who will be number 1 in a few years) and Germany.

Which markets has gotten the most attention from Elon? USA, Germany and now China. Plus of course Norway and Holland for their high sales numbers.

I wonder how long it takes before they put the same focus on Japan, another big luxury car market.

Nelson

China as a whole will survive but I would not wish the quality of life and air in some parts of China on anyone. At least some states in the US are joining together to correct years of pollution. I heard today CA is back in black financially. Wonder how much of that is attributable to the fact that they have substantially reduced their use of imported oil/gas. By “imported” I mean not produced in CA.

NPNS!
Volt#671

Mikael

Neither would I. But that goes for a lot of places in the world, unfortunately. And it’s good that there are places going in the right direction, like CA is doing now.
I have friends from LA who have a lot of friends and relatives who have died in lung cancer (none of them smokers). Hopefully it can turn into a place where the quality of the air is half as good as I’m used to.
I was last there in 2005 and then it was still hard to breath the air at times.
My worst air quality experience so far is Manilla,

Mikael

You forget that it’s Tesla that wants in on the chinese market. The chinese market don’t really give a shit about a close to non-existant company. If they do as they like with companies who sell millions of cars what could a 25k car company do? If they just prohibited Tesla from going into the chinese market no-one would know or really care.

How many super chargers do you think will be granted permission if Tesla pisses china off?

And how much do you think a $200k+ car buyer (which they are targeting) who has his own driver care about the gas bill? Especially since a lot of the luxury cars in China are not used to drive around much in but to stand on the driveway to show the neighbours that they have money.

Dr. Kenneth Noisewater

That’s not Tesla’s job. As long as they break out the taxes, duties, fees etc. and behave transparently about pricing that’s good enough for me (and better than their competitors at the moment). I’d be more worried about Chinese IP theft and coerced partnerships, as well as the whole Tesla trademark thing.

Besides, who knows, China might decide to lower or waive some of those for EVs given how awful their air quality is..

Mikael

Haha…Last time I heard the US government comment on their funny business and the NSA spying they responded with “Everyone is doing it”.
Some IP theft just seems like Karma…

The partnerships is a great idea. Making them “voluntarly” share technology and know how to get into the worlds largest market. Unlike for example the japanese who kopied and stole everything they could when they went from a developing country to an industrilized country.

The trademark thing is just nuts though. But that’s a common thing in any part of the world… I remember a time when people registered web addresses just to be able to get some money from the companies who “should” have them.

DaveMart

Unfortunately the burn of vast quantities of not very good quality coal in less than state of the art power stations mean that China’s electricity production is very dirty indeed, and likely to stay that way for the foreseeable future despite their best efforts.
It is doubtful that EVs are much, if any cleaner than petrol cars in China.

If they really wanted to, China would probably just buy a controlling % of Tesla stock and move the company to China.

On one hand, if I were an investor I would be upset that Tesla isn’t charging what the market will demand, especially for luxury, futuristic goods. Especially considering they’re supply constrained. If they were hard-up for sales in China then maybe it would make more sense.

Mikael

Well thankfully Elon has larger goals in life than just making money. He is helping the world to be a better place and profit maximization has never and will never be a part of that.

Boris

Well, he does need the cash to develop Gen 3, build the gigafactory, perhaps build another factory in Eastern Europe etc etc etc. Saving the World won’t work if you don’t have cash in your pocket. Actually I really don’t understand why he’s leaving money on the table, guess there must be a good reason for it…

Mikael

Sure…be he/Tesla can do that without pricing the Tesla higher in some countries just because that’s what other companies have done. They will gain as much as from Teslas sold in Europe or the US.

Just because you can doesn’t mean you should. A good enough reason would be that it’s unfair to charge that much when they don’t need to.

And surely they have a plan for where and how to invest with the money they get anyway. And so far it’s been all about the long run…

Boris

Actually my guess is that demand in Europe is lower than expected (nobody really knows who Elon is here, I believe he needs to come over and present himself in media, he’s got such a wonderful story to sell) and maybe the US demand is slowing. So if Tesla wants to hit 40,000 vehicles sold this year, they have to be agressive in China. I hope I am wrong however…

Mikael

I doubt that the lack of demand is a factor in going into China since they have been planning this and excecuting it for a long time now.

I think it being the largest car market by far and second largest luxury car market heading for number one are reasons enough.

Norway alone will want 6000+ Teslas in 2014 and there are a lot more markets waking up.

But adding markets will keep the demand up and make it a car people want just because it’s hard to get seems like a smart move.

40k I don’t think will be a problem for them. 60k though, then they will need some help from the chinese market and that the german market starts to blossom (and it would be sad if it didn’t after getting a net of super chargers covering the whole country in 2014).

Boris

Really hope you are right. I am a bit worried about Germany. Many (if not most) of the premium cars are bought by companies for their employees. This way cmpanies can deduct the value added tax (somthing like a sales tax in the US, which is good for the individual driving the car as he/she would simply have to pay the VAT) plus they use the car as an expense, they mostly buy 4 cylinder diesel wagons like A6 or E-class. They buy these cars at very high discounts. Most of the time the list where people can choose their cars only contains MB, BMW and Audi, that’s it, no Lexus, no Volvo nothing. Plus Germany has no tax benefits for electric cars. Actually I’m really looking forward to February quarterly call where Elon will hopefully go into details on how many cars sold where….

Mikael

It is a hard market to get into, for more than one reason. And so far the EV market there is really poor (less than 7000 in 2013 and just about 200 Teslas).
Not even their own i3 is selling much yet.

But as I said, I think they can do 40k without that market and the chinese market. I’m hoping for 60k Teslas sold in 2014.

Nobody really know’s who Elon (or Tesla) is in the US either. Still in the infancy stages.

Wait for the next gas price spike, then you’ll see some awareness.

JakeY

They have to build the brand name first, so following the same pricing strategy they did elsewhere makes sense. Openly price gouging is might sour the reception of the brand.

Alok
Yes, great price indeed! The starting price of a BMW 7 Series there is about $154,000. And with what one will save in running costs… The 7 Series Active Hybrid starts from $247,000! And to have only 85 kWh cars is great for simplifying Superchargers’ layout! Smart choice. The savings for a 60 would have not been much, anyway. (Here’s why:) Even in US or Europe, I don’t see a real convenience in getting the 60 kWh (maybe unless one drives really a little…). That’s because, considering that the bigger battery lasts longer, the premium price doesn’t mean higher cost per mile of the car. Actually, the other way round, since you can drive the car at least proportionately longer, in its whole life (at least 30% more miles***), while the cost is just (in US) about 15% more (16% considering the after the $7,500 tax credit, 14% without). Oh, and that’s considering a $10,000 difference. But if you want to be Supercharger-enabled the difference goes down to $8,000, or about 12% premium. So, basically, with an 85 kWh you get a lower cost per mile (and per year, of course), while enjoying the extra convenience of the longer range… Read more »
Dr. Kenneth Noisewater

At least since the last time I checked the configurator, the 85kWh battery in a Model S nets out to about $8k more than the 60kWh variant thanks to the ‘free’ Supercharger in the former. $8k for 15kWh? Yes please!

Dr. Kenneth Noisewater

err, make that $8k for 25kWh, which is even better!

Alok

Exactly!

And you also have better performance for that price premium:
60 85
0-60 time 5.9 s 5.4 s
Top speed 120 mph 125 mph

And, again, since resale value will remain higher (probably by $8,000 or so…) for many years, you might be able to recover the extra $8,000. That is, you’ll be able to enjoy the range and performance advantages at basically 0 cost!
🙂

Andrew K

A very savvy move on Tesla’s part to break out the pricing and undercut their competition. Just keep in mind that they have a significant advantage over BMW, VW AG, Daimler AG in that they haven’t been in the country for years, had to build plants, had to bribe officials, etc. This allows them to just bring the car over with their normal 25% profit margin that has been established around the world for a relatively low price.

For the wealthy Chinese buyer perhaps the Tesla will be a way to have a status symbol that is powerful, and green, and modest (in price terms to the standard BMW/Audi/Merc options).

sven

Some Tesla investors would say that leaving money on the table in China is not a very savvy move.

Stuart22

Tesla ought to ramp up a ‘zero emission, clean air’ sales campaign there. Air quality is terrible and unhealthy in many areas, far worse than in the West. I’d bet the Chinese would respond with an avalanche of demand which would catapult Tesla forward in its amazing journey.

sven

What happened to the Tuosule brand name for China? In the pic of Chinese Tesla Motors webpage it says Tesla, not Tuosule. When did Tesla Motors buy back the rights to the Tesla trademark in China? I thought some guy in China registered Tesla as a trademark before Tesla Motors tried to register it and wanted a king’s ransom to sell the Tesla trademark to Tesla Motors, but Tesla Motors refused to pay.

“they fixed.. the glitch”
“wait wha-”
“- I said, they fixed.. the glitch”

ModernMarvelFan

The reason that Volt is more expensive “relately” is b/c the import tax is higher on the Volt (relative to the price of the car)…

Anon

I love it when the Chinese buy American made goods. 😀

ggpa

If the Chinese start ordering, can Tesla produce enough cars?

ggpa

The price breakdown shows the US price as $81070 (not $79900) which means that the Chinese buyers pay the US destination charge, and an additional $3600 in shipping 🙂