Is Tesla Motors Inc Failing Chinese Customers?

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Tesla Motors Inc (NASDAQ:TSLA) is failing Chinese customers, who have to wait too long for repairs and in processing insurance claims. Jiemian, a Chinese financial news site, revealed that a Chinese owner had to wait for more than two months to get Tesla to negotiate with his insurance company regarding his damaged Model S.

Long list of complaints

According to Chinese insurance law, policyholders are reimbursed for the cost of repairs. In a case of serious damage, the EV manufacturer’s insists on changing some important components such as battery pack and motor to protect their company secrets. This means that the insurance companies, which offer insurance cover to more conventional vehicles, may deny these payments.

Additionally, Tesla Model S owners are not very satisfied with the general repairs in the car. Even after having a fully equipped service center in Beijing’s Yizhuang area, certain parts must be shipped from the United States causing delays and shortages, an issue common among low-import vehicles, according to a Beijing-based analyst.

According to Wu Bixuan, Tesla Motors global vice president, the company is putting great efforts to increase its service network in China, which is a “most crucial task” in the country.

China an important market for Tesla

China is one of the most important markets for Tesla, where the company has already started delivering  vehicles. This year, Tesla CEO Elon Musk is eying a sales target of 5,000 Model S units in China, and the company also entered into a deal with China Unicom to build 400 charging stations in 120 cities. Last month, the Palo Alto-based company ended a long-running trademark fracas with a Chinese company that risked the expansion of the company.

“I think [China is] really important. I think it could be as big as the US market – maybe bigger,” Musk said recently.

Last year, Tesla sales surged 387% to more than $2 billion. However, a lot of confusion still surrounds the company regarding its ability to its achieve ambitious goals. Tesla shares tanked to their lowest point in six weeks on Monday after a report from JP Morgan estimated that the company would assemble 303,500 cars in 2020, far below the company’s target of 500,000 vehicles.

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