Tesla Motors has been struggling to improve its Chinese operations, and the problems are only mounting for the U.S. firm. Presently, a major problem for Tesla is that more and more domestic automakers are getting into the business of making electric vehicles.
Tesla faces a tough time in China
A recent report from Reuters informed readers that Beijing Electric Vehicle Co, a state-owned car maker in China, partnered with Atieva, a U.S.-based start-up, to manufacure EVs for China. Beijing Electric Vehicle, an affiliate of BAIC Motor Corp Ltd., is reportedly working on autonomous driving features and electric cars at its San Francisco tech center. The firm has is also operating a research center very close to Tesla’s assembly lines in Fremont.
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SAIC, another Chinese automaker, will also be working on future auto technology, for which it has plans of opening a research facility in Silicon Valley. Chinese automakers are making such technological advancements with an intention of manufacturing high-standard EVs capable of competing with EVs from foreign firms like Tesla.
Tesla has been very prominently conducting research in autonomous driving features, but new entrants can pose serious competition in a short time.
Local automakers enjoy government support
Local automakers striving to come up with electric vehicles enjoy the full support of the Chinese government as the country is facing a serious problem of excessive carbon emissions and deadly smog in major cities like Shanghai. China is also highly dependent on imported oil and wants to bring this dependence down and at the same time raise the adoption rate of electric cars.
The Chinese government has set a 5-year plan aiming to bring 5 million EVs to the roads by the end of this decade. The government wants more entrepreneurs to get into the business of producing green cars and is encouraging them with heavy subsidies.
Jia Yueting, the chief executive officer of Leshi Internet Info. & Tech. Corp., which is also known as the Netflix of China, is one such entrepreneur. He already made an announcement about his plans to come up with an electric car that will give Tesla a run for its money. Shanghai-based NextEV and Faraday Future are other Chinese startups that plan to compete with Tesla.