Tesla Summoned by Chinese Regulators on Quality Issues -- Update
February 08 2021 - 9:33AM
Dow Jones News
By Trefor Moss
SHANGHAI -- Tesla Inc. has been summoned by the Chinese
authorities in response to consumer complaints about quality issues
with its electric vehicles, a rare official rebuke for Tesla in
China, where the company has expanded rapidly with the support of
the authorities.
The State Administration for Market Regulation, China's top
market regulator, said Monday that it had instructed Tesla to abide
by Chinese laws and regulations and strengthen internal management
to ensure the quality and safety of its products.
Some of China's biggest state-owned banks have been instrumental
in funding Tesla's operations in the country, lending the company
roughly $2.36 billion in 2019 and 2020 as it constructed, and then
expanded, its Shanghai plant.
The plant was then able to start producing cars within 12 months
of breaking ground thanks in part to the speed at which the local
authorities issued permits.
Tesla China didn't respond to a request for comment.
Tesla recently recalled 36,126 Model S and Model X vehicles
imported from the U.S. because of touch-screen problems, according
to a separate SAMR statement issued on Friday. That followed the
recall of 48,442 imported Model S and X cars in China in October
over concerns about faulty suspension systems.
The Global Times, a state-owned Chinese tabloid, criticized
Tesla for the recall on Saturday, claiming it "reflects the brand's
ignorance in understanding Chinese consumers."
Quality issues don't appear to have slowed Tesla's sales
momentum in China, however. The company sold 15,484 locally built
Model 3 sedans and Model Y compact crossover vehicles in January,
according to the China Passenger Car Association.
That followed China sales of 135,400 vehicles last year,
according to the association, a performance that helped the company
post its first yearly profit of $721 million in 2020.
Tesla started delivering the Shanghai-built Model Y last month,
having launched the made-in-China Model 3 a year earlier.
The recalls didn't apply to Tesla's locally built models.
Raffaele Huang contributed to this article.
Write to Trefor Moss at Trefor.Moss@wsj.com
(END) Dow Jones Newswires
February 08, 2021 09:18 ET (14:18 GMT)
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