A statement was made by Tesla Motors Inc. (NASDAQ:TSLA) whereby the automaker asserted that its vehicles had gained approval for a program carried out in Shenzhen, China. Under this program, Tesla Motors Inc.’s (NASDAQ:TSLA) cars, newly manufactured energy vehicles will have their license plates specifically set aside for them. This factor would serve to elevate the company’s status in the automotive market, where sales had been lagging behind the expectations.
Under the terms of this licensing program, customers aspiring to buy Model S electric sedan can file application for license plates and this is applicable from today onwards. This program makes sure that every year nearly 20,000 tags are set aside for this particular purpose. License plates that are awarded through regular channels utilize lottery systems and auction systems. Both these channels are utilized so that pollution can be effectively masked.China suffers from severe smog and traffic problems. In order to mitigate this threat of pollution, China holds auctions to award license plates. This is done so that the number of vehicles on the roads can be limited and consequently pollution can be diminished.Owing to these reasons, laying hands on license plates can be a difficulty.
Tesla Motors Inc. (NASDAQ:TSLA) has been exempted from this mandatory requirement. Generally, these licenses can go as high as $15,000 so this exemption can serve as a particularly trigging incentive to go electric. Moreover the sales of Tesla Motors Inc. (NASDAQ:TSLA) wouldundeniably get boosted by this.
This license plates approval has enabled Tesla Motor Inc.(NASDAQ:TSLA) to battle its Chinese competitor BYD Co. This latter electric car maker has its basis in Shenzhen. However, despite this approval, customers of Tesla Motors Inc. (NASDAQ:TSLA) are not eligible to benefit from various incentives provided by the government for electric vehicles. Some examples of these incentives are exemption of sales tax and other subsidies.
The Chief Executive Officer, Elon Musk, of Tesla Motors Inc.(NASDAQ:TSLA) said that the company would be reducing jobs so that this cutting down can play some part in compensating the company’s loss. It ought to be noted here that the company’s sales trailed behind its expected target.
BYD Co. came across a downfall, amounting to almost 4.3 % in today’s trading carried out in Hong Kong. This is in comparison with a decline of almost 0.3 percent in Hang Sang Index.
Tesla Motors Inc. (NASDAQ:TSLA) initiated its endeavor of car delivery in China in the previous year. Incidentally, China happens to be the world’s greatest automaker market with the largest potential in it. By now the company owns nine stores along with service centers. The network of these stores and service stations is spread across six significant Chinese cities. Moreover, in order to develop charging stations, Tesla Motors Inc. (NASDAQ:TSLA) has also formed alliances with various companies such as China Unicom and Soho China Ltd.