tesla Despite the overall industry slowdown, the company remained a strong competitor in Beijing’s fiercely competitive electric vehicle market, as sales of its Chinese-produced EVs grew slightly year-on-year in January.
Tesla delivered 69,129 vehicles from its Shanghai Gigafactory in January, up 9% from 63,238 in January 2025, according to data released by the China Passenger Vehicle Association on Wednesday.
The latest January delivery numbers put Tesla in third place against other Chinese EV makers. BYD took the lead with 205,518 shipments, but geely According to CPCA, it came in second place with 124,252 units.
Despite the increase in deliveries, there is little sign that demand for Tesla products in China, the world’s largest EV market, will actually increase.
The company’s January shipments reflect total shipments from Tesla’s Shanghai Gigafactory, which produces the Model 3 and Model Y for domestic and international markets such as Europe and Asia Pacific.
According to Reuters, the number of new registrations of Tesla passenger cars, a sales proxy, rose slightly in Europe in January.
domestic price war
Tesla faces stiff competition from a number of Chinese EV brands that offer more affordable products. In a separate report, CPCA noted that Tesla’s total sales of EVs produced in China decreased by 4.8% in 2025. The company was one of only two companies in Beijing to report a year-on-year decline in annual sales.
The base model of Tesla’s Model 3 sedan costs about 235,500 yuan (about $33,943), nearly three times the price of the base model of BYD Seal (about 79,800 yuan).
Like other automakers, Tesla has sought to remain competitive in China through aggressive price cuts. Tesla is now offering five-year 0% interest loans or seven-year “ultra-low” interest loans for orders placed by February 28, according to a Chinese website.
“Despite government and industry calls for automakers to avoid aggressive pricing strategies, we continue to see very intense price competition,” Abby Tu, principal research analyst at S&P Global Mobility, told CNBC.
Despite this price war, China’s EV market has slowed significantly.
Sales of new energy vehicles, including hybrids and battery-powered vehicles, rose just 1% year-on-year in January, the fourth straight month of slowing growth, according to CPCA data.
The economic slowdown is expected to continue as the Chinese government reduces support for new EV sales. From January 1, the 5% tax on new energy vehicle purchases was reinstated, after the 10% tax had been fully waived for more than a decade. New energy vehicles include battery vehicles and hybrid vehicles.
new regulations
Tesla’s challenges are compounded by the Chinese government’s recent announcement to effectively ban hidden door handles.
On Monday, China’s Ministry of Industry and Information Technology announced that from January 1, 2027, all door handles of cars sold in the country will be required to have internal and external mechanical releases.
The announcement follows a series of high-profile incidents in the United States and China in which EV occupants involved in traffic accidents could not be rescued after vehicle fires occurred as a result of power outages in door locking mechanisms.
Chinese automakers are well prepared to ensure compliance with the new regulations, but it remains to be seen how Tesla will adapt, given that flush door handles were first popularized as a signature design feature on Tesla’s minimalist cars.
Some analysts, such as Tu Le, founder and managing director of consulting firm Sino Auto Insights, believe China’s new car door handle regulations are likely to cause “significant headaches” for Tesla.
However, Tu said China’s new regulations will have little impact on most automakers.
“For many Chinese brands, this new regulation is (probably) not a surprise, as regulators intensively consulted OEMs and industry experts when drafting the new regulation,” Tu said.
CNBC’s Evelyn Cheng contributed to this report.
Correction: This copy has been updated to reflect the correct spelling of the name of Abby Tu, Principal Research Analyst at S&P Global Mobility.
