China-made Tesla Model 3 vehicles are seen at the Shanghai Gigafactory of the U.S. electric car maker in Shanghai, China December 30, 2019. REUTERS/Yilei Sun - RC2I5E9LQORA/File Photo
Elon Musk plans to attend a ceremony to mark the first deliveries of made-in-China Tesla Inc. vehicles to customers on Tuesday, according to people familiar with the matter.
Tesla, which is already churning out more than 1,000 Model 3 sedans a week at its plant on the outskirts of Shanghai, handed over a batch of cars to a select group of employees on Dec. 30, but Tuesday marks the first deliveries to the general public.
The ceremony is due to start at 3 p.m. local time at Tesla’s first factory outside the U.S., a milestone in Musk’s plans for the company he founded to go global.
Yet it comes at a challenging time in China’s auto market, where forecasts point to a third-straight annual drop in total sales.
Electric vehicle sales plunged 42% in November from a year earlier as the government pared back subsidies on purchases. In a bid to lure buyers, Tesla cut the starting price of its China-build Model 3 sedans by 9% so that they’ll be more closely aligned to some local EV makers.
It may cut prices further mid-year as it increases localization of components, people familiar with the matter have said.
"The demand for our locally-built model 3 is very good,” Allan Wang, general manager of Tesla China, said last week. "We are confident about selling all vehicles manufactured in this factory.”
Tesla didn’t immediately respond to a request for comment.
