Tesla Motors Inc (NASDAQ:TSLA) CEO and founder Elon Musk had an impression that his vehicles were demanded in large numbers in China, because of which inventories were stocked in sufficient numbers. But much to his dismay, the local speculators misled him, and the demand for electric cars in China is not as high as he believed it to be, informed Musk at the Boao Forum in Hainan province.
Excess inventory, ‘speculators’ to blame
Quoting Musk, the official news agency Xinhua reported that there were several number of resellers, who cancelled their orders on the arrival of the cars. “China is the only place on earth where we have excess inventory. We are essentially selling cars that speculators ordered but we were unable to deliver,” he said.
Import of 16,000 units of Tesla S vehicles was made into China. However, the whipping up of demand by the speculators became the prime reason for improper licensing of those vehicles.
A downfall of 45% from January was noted in the number of Tesla Motors Inc (NASDAQ:TSLA) Model S licensed in February, according to Equity research firm JL Warren Capital.
Tesla CEO optimistic
Tesla Motors Inc (NASDAQ:TSLA) CEO, who holds a prominent position in the tech industry, wanted to tap the benefits and huge sales opportunities in the largest economy of the world. The company has been facing problems in making sales in China, but the founder has plans of continuing making his efforts.
Sales in China have been growing at a steady pace for the last three months, and this makes Musk optimistic in the Chinese automobile market. Musk stated the commitment between with China is a long-term one, and it aims at establishing both local production and local engineering in the region.
Tesla Motors Inc (NASDAQ:TSLA) began taking orders for the Model S sedan since mid-2013 in China. Delivery began to the customers in April last year. A report from Xinhua informed that there are serious concerns among the Chinese customers that the charging network of Tesla Motors Inc (NASDAQ:TSLA) is limited, and therefore, the company is making efforts for expanding the network. Also, the customers are being offered with mobile adapters so that they can charge anywhere.