Tesla Motors, Inc. (TSLA – Analyst Report) will modify its vehicles for China according to the country’s charging standards, per media reports. The Chinese standards are currently being set and Tesla is part of this process. The time frame for the implementation of the standards is not certain as of now. Once the standards are set, the automaker will manufacture vehicles that are compliant with the same.
This move should help boost Tesla’s sales in China once a charging network is developed. Concerns related to charging have been the chief reason for the automaker’s weaker-than-expected sales in China. Though Tesla is building its own Supercharger network in the nation, it has not alleviated consumers’ concerns.
As a result of weaker-than-expected sales in China in the fourth quarter of 2015, Tesla is restructuring its operations in the country, leading to a cutback in employee count.
China is an important market for Tesla as apart from being the world’s largest automobile market, it offers significant opportunities for electric cars due to its pollution issues. Moreover, Tesla has invested significantly in the nation. The company currently has nine stores and charging stations in China, with three more set to open soon. Further, it has partnered with China Unicom and Soho China Ltd. to build charging stations in the country.
Tesla currently carries a Zacks Rank #4 (Sell). Better-ranked automobile stocks include American Axle & Manufacturing Holdings Inc. (AXL – Analyst Report), PACCAR Inc. (PCAR – Analyst Report) and Fox Factory Holding Corp. (FOXF –Snapshot Report). American Axle sports a Zacks Rank #1 (Strong Buy), while PACCAR and Fox Factory carry a Zacks Rank #2 (Buy).
