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Green Crash: Tesla’s Hong Kong Sales Collapse After Tax Breaks Are Canceled

Motor1 News

Not a single Tesla was sold in the country in April.

Following Hong Kong’s decision to reduce incentives for electric vehicles, sales of Tesla vehicles in the country plummeted. The local government slashed a tax break for electric vehicles on April 1, which resulted in no Model S or Model X deliveries during the whole month. Data from Hong Kong’s Transportation Department also reveals only five privately owned electric vehicles were sold in May.

For a comparison, in March alone a total of 2,939 Tesla cars were registered, almost double the result of March 2016. During the first quarter of this year, new registrations were approximately 3,700.

While this collapse might seem like an insignificant local phenomenon, it actually affects the global sales of the company. During Q1, Tesla registered record sales of more than 25,000 units globally, but in the next three months deliveries fell to just over 22,000 as a result of Hong Kong’s slump. Also, the collapse reveals once again how sensitive the automaker’s performance can be to government incentive programs. However, Tesla does not agree.

“Tesla welcomes government policies that support our mission and make it easier for more people to buy electric vehicles, however, our business does not rely on it,” Tesla said in a statement quoted by Market Watch. “At the end of the day, when people love something, they buy it.”

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