With production starts at Tesla's Shanghai plant, and price cuts to stimulate demand, Model 3 sales in China will reach 150,000 in 2020, according to CITIC Securities.
CITIC analysts predict in a Monday note that in the future Tesla sales are expected to reach more than 300,000 units, and the Chinese market will become the most important growth engine.
Tesla's product pricing system benchmarks Mercedes-Benz, BMW, and Audi. With reference to Tesla's sales performance in North America and Europe, it is expected that the steady sales of Model 3 in China will reach more than 300,000 vehicles, the note said.
The sales volume of Model 3 in North America exceeds that of Mercedes-Benz C-Class, BMW 3 Series and Audi A4, with a ratio of 1.6; the sales ratio of Model 3 to competing products in European market is 0.3, and the ratio is expected to continue to increase after the subsequent European plants are established.
The steady sales of Tesla's competitive products in the Chinese market are 450,000. Considering that the current Model 3 has achieved parity with competing fuel vehicles in the Chinese market, the steady-state coefficient is expected to exceed 0.7, and the corresponding steady-state sales of the Model 3 in China More than 300,000 vehicles.
After Tesla adopts the Chinese supply chain, China-made Model 3 will have a price reduction space of 27% to 34% from its current price, and the lowest price may be as low as 197,000 yuan ($28,000), Chinese newspaper Securities Daily said on Monday citing unnamed analysts.