Can Tesla Motors Inc (TSLA) Benefit From Chinese Government Exemptions For EV Sales?


Tesla Motors Inc (NASDAQ:TSLA) has restrictions for selling its vehicles in 5 states of USA, but China has been a strong supporter of Tesla’s EV’s mainly due to Chinese Government’s efforts to reduce the ever growing pollution in the country. Some reports state that Tesla car owners in Shanghai can save $12000 by purchasing a Tesla vehicle due to new regulations. Brittany Umar reported about this in ‘The Street’.

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In an effort to increase the electric vehicle sales in the country and reduce the pollution and countries dependence on fuel from foreign countries, government has decided to cut down the license plate fee of $12,000 for new EV’s in Shanghai. Other cities in China might join the list soon as Tesla Motors Inc (NASDAQ:TSLA) is in talks with other cities for exemption as well. This might turn out to be a good news for Tesla Motors Inc (NASDAQ:TSLA) as this exemption might accelerate the vehicle sales in China, which is one of the biggest market in the world right now.

“Owners of Tesla electric vehicles in Shanghai can reportedly now register them for free — instead of paying the typical $12,000 fee for a license plate. That’s part of Shanghai’s efforts to encourage the adoption of new-energy vehicles, according to Ma Jing, vice director of the municipal government’s economy and information commission cited by Bloomberg, which also reported that Tesla is in contact with other cities to get exemptions,” Umar reported.

Umar pointed out that the registration fee for Tesla Motors Inc (NASDAQ:TSLA)’s Model S vehicle is already exempted in Hong Kong. She added that all these exemptions are mainly due to the action plan released last year by state council in an effort to fight pollution in the country. She added that the action plan includes steps like phasing out heavily polluting vehicles and plans to get cleaner gasoline and diesel by 2017.

Umar also pointed at Tesla Motors Inc (NASDAQ:TSLA) CEO, Elon Musk’s comments that the rate of location openings will be fastest in China during second half of 2014.

As of  30 June 2014, Ken Griffin’s Citadel Investment Group hold around 44.5 million Tesla Motors Inc (NASDAQ:TSLA) shares.

Disclosure: None

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