Tesla Motors received an order of 100 Model S85 sedans from a taxi company in Wuhan, China. The news is a big positive for a company struggling to expand its market share in China.

Tesla Motors Inc Gets A Big Order From Chinese Taxi Firm

Will it help Tesla?

A report from Tech In Asia suggested that Wuhan Tricycle Automobile has purchased 10 Tesla Model S sedans, and will take deliveries of 90 other vehicles later. The taxi company is looking to run 1,100 electric cabs on roads to promote zero-emission vehicles in the country to bring down smog problems. Dongfeng and local manufacturer BYD are other companies that are supplying electric vehicles to the cab firm.

Wuhan is not a very huge market compared to Shanghai, Beijing or Shenzhen, but it definitely can help Tesla enhance its performance in the country. Tesla, a company trying to turn around its performance in China, will surely get a boost from the Wuhan Taxi service order. China has remained reluctant so far, and there are substantial doubts among the Chinese about the Model S. Tesla’s CEO said in February that he has worked on resolving the range anxiety concerns of Chinese customers.

A report from Xinhua Finance Agency suggested that Tesla’s vehicle is priced at 960,000 yuan and will be bought before August and will run on Wuhan streets in September.

Success of electric cab service in question

Customers could take a ride in a Model S by paying an upfront fee of between 16 and 25 yuan or 3.5 to 4 yuan on every kilometer, which is more than internal combustion engine vehicles. However, the price may not seem high as commuters will experience the excitement of sitting in a car that accelerates from 0-60 miles per hour in just 4.4 seconds. Wuhan Tricycle’s CEO said it would attract the rich business class.

Many European countries like Holland and Norway are already using electric vehicles for a cab, but for China, this will be its first step. If the Model S succeeds in convincing the Chinese that the electric vehicle is a better way to commute, then it will be a great development for all electric cars.