Sales in Tesla’s second-biggest market fell dramatically in May as public outcry and government scrutiny mount following the company’s handling of consumer complaints.
The Information reports that internal data recorded only 9,800 sales in China last month, down from more than 18,000 in April. The report also sent Tesla shares tumbling by 5 percent in the afternoon following its publication.
Tensions between Tesla and its customers mounted in April when a customer climbed on top of a Model 3 at the Shanghai Auto Show to protest her Tesla’s faulty brakes. The protester claims that the brakes on her Model 3 failed, leading to an accident that nearly killed four of her family members.
Read Also: Tesla’s EV Dominance Of China Could Be Threatened In 2021
A female Tesla owner climbed on top of a car’s roof at the Tesla booth to protest her car’s brake malfunction at the Shanghai auto show Monday. The booth beefed up its security after the incident. pic.twitter.com/ct7RmF1agM
— Global Times (@globaltimesnews) April 19, 2021
Although Tesla disputes the claims and apologized for not addressing customer complaints in a timely manner, China’s market regulator urged Tesla to ensure product quality in the country shortly after the incident. A local paper, The Global Times, meanwhile, wrote that “The arrogant and overbearing stance the company exhibited in front of the public is repugnant and unacceptable, which could inflict serious damage on its reputation and customer base in the Chinese market,” per Reuters.
The company is trying to curry favor with China’s regulators and has beefed up its government relations team in response to these issues. It has also set up a data center in China to store data locally and is opening up a platform for customers following reports that its vehicles are banned at certain government facilities over fears of spying.
Certainly, this will be a big concern for the U.S. automaker since China is the biggest global market for vehicles and a major force in electric car sales. Moreover, being Tesla’s second-biggest market, it made up nearly 25% of the automaker’s sales in 2020.