Tesla Agrees to Dance to China's Tune

Tesla agrees to dance to China's tune
Tesla agrees to dance to China's tune

In a surprise development, bearing in mind how independent and strong minded Tesla has been in years gone by, the company has agreed to abide by Chinese government charging standards in the future. On the surface this may look like the company has "given in" to the Chinese authorities but there are very strong underlying reasons why the company would like to keep the Chinese authorities onside. Do not forget that Tesla is run by a billionaire entrepreneur who knows exactly what he is doing and always keeps his eye on the long-term scenario.

Why should Tesla concede to China?

It is not really a case of Tesla conceding anything to the Chinese authorities it is simply Tesla confirming that it will respect Chinese government charging standards going forward. This will mean relatively simple changes to the Tesla charging system available at this moment in time but it will open a potentially enormous market for the company. It is also worth noting that China has yet to publish its future electric vehicle charging standards but there is no doubt that the government of the day is very keen to expand the electric vehicle market.

Tesla and the Chinese market

When you bear in mind that less than 2,500 Tesla vehicles were registered in China during the nine months to April 2014 this perfectly illustrates the difficulties the company has been having. China is an absolutely enormous market and one which the company needs to "crack" in order to become a truly global operation. This is perhaps the company’s least successful market to date although in theory it is up there with the top two future electric vehicle markets - perhaps beaten only by the USA.

Comments from ElectricForum.com: "The Tesla Motor Company is by far and away the best known name in the electric car industry incorporating the latest electric vehicle technology, battery supply efficiencies and sleek sports car designs."

It would also be fair to say that the Chinese government, and Chinese electric vehicle manufacturers/retailers, have also had difficulties converting the Chinese population to their more favoured form of transport. So we can only guess at the potential success of a Tesla/Chinese government joint operation to flood the market with quality products which are compatible with future Chinese electric vehicle charging standards. In simple terms, this should be a long-term win-win for all parties involved!

Planning for the future

If you look at the history of Tesla you will see the company has planted many seeds, which often take years to grow. However this carefully adopted strategy is certainly paying dividends as the company becomes ever more popular and is by far and away the best known electric vehicle company in the world.

It is inconceivable to even think that Tesla is "giving in" to the Chinese authorities because the bottom line is that only electric vehicles compatible with Chinese charging standards will be successful. In years to come we will have the heady mix of Tesla's reputation and compatibility with local charging standards creating an environment in which it should be easier to convert Chinese motorists.

Conclusion

While Tesla has made mistakes in years gone by: targeted unsuccessful markets, switched technologies, and repositioned itself on numerous occasions, the Tesla we see today is a very powerful beast. To the general public it may look as though the company has conceded to Chinese government demands but the reality is that China will be one of the largest electronic vehicle markets going forward and it is inconceivable to even think that Tesla will not be a part of this giant arena. Watch this space!