Tesla introduces 0% interest loans in China to boost sales
What's the story
In an effort to regain its declining market share, Tesla is introducing a new incentive in China—offering 0% interest loans on its electric cars.
This limited-period offer comes on the heels of end-of-quarter incentives and is designed to strengthen the company's foothold in China, which is recognized as the world's largest auto and electric vehicle (EV) market.
Market challenges
Tesla's market share declines in China
Tesla is facing significant challenges in the Chinese market.
Data from China's Passenger Car Association, as reported by Bloomberg, indicates that Tesla's market share fell from 10.5% to approximately 6.7% during 2023.
The start of 2024 did not bring any relief for the company as it revealed a contraction in global deliveries for the first time in years.
Loan scheme
Details of Tesla's new loan scheme in China
To counter these challenges, Tesla has launched a limited-time 0% interest loan scheme in China.
This incentive is applicable to Model 3 and Model Y. However, it requires a substantial down payment of CNY 79,900 ($11,000).
Tesla's new initiative aligns with a recent announcement by China's People's Bank of China and National Financial Regulatory Authority.
They stated that they would allow financial institutions to determine the "maximum disbursement ratio for the self-use of new energy vehicle or fuel vehicle loans."