Tesla's Opportunity: China's EV market is 3x bigger than the US EV market [Video]

When Elon Musk was on-hand for the launch of Tesla's new Gigafactory in Shanghai, it was a groundbreaking occasion in more ways than one. The opportunity in China is enormous for Tesla. "China’s Association of Automobile Manufacturers (CAAM) reports that China sales of EVs grew 60% last year, reaching 1.26 million units," reports Electronics Weekly. This means that China's EV market is 3x bigger than the US EV market.

Above: China's EV market is triple the size of the US EV market (Chart: Electronics Weekly via Statista / Source: InsideEVs, CAAM)

Trefor Moss elaborates in the Wall Street Journal, "Sales for electric vehicles in China are thriving, topping 1 million for the first time last year, helped by government subsidies and other favorable policies."

With the launch of the company's new Shanghai Gigafactory, "Tesla now faces a race to start local production to take advantage of robust demand for electric vehicles in the world’s biggest auto market.... [as] China is central to Tesla’s aim of graduating from niche startup to mainstream global auto maker."

Above: A Tesla Model X in China (Image: Future Car)

"In China, Tesla has the opportunity to rev up, capitalizing on the government’s support for electric vehicles and well-to-do Chinese car-buyers who are captivated by Tesla’s technology and enamored of Mr. Musk’s entrepreneurial risk-taking," explains Moss.

“It makes sense for Tesla to commit fully to becoming a leading EV brand in the world’s largest EV market,” says Bill Russo, chief executive of Shanghai-based consulting firm Automobility.

Above: Inside Tesla's big move in China (Youtube: Wall Street Journal)

In addition, Tesla has a unique head-start. Moss reports, "Tesla was the first foreign auto maker to take advantage of a recent rule change allowing foreigners to own their China business, instead of having to work with Chinese partners as previously required." That said, Tesla still needs to face-off against local competition. Can China's EV companies really stack up against Tesla? We'll soon find out.

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Source: Wall Street Journal, Electronics Weekly