On the afternoon of May 22nd at around 4 o’clock, the Tariff and Taxation Commission of the State Council released the “Announcement on Reducing Tariffs on Imported Vehicles”.
At this moment, California is shrouded in darkness, while the Fremont factory is still striving towards the goal of producing 5,000 Model 3 vehicles per week, and several container ships are sailing across the Pacific to Shanghai, Tianjin, and Guangzhou.
In a delivery office: “The tariff has been lowered from 25% to 15%. That’s great!”
“But it starts from July 1st, right?”
“Oh, what about my current clients? They won’t want to take delivery anymore, as the price difference is several tens of thousands…”
“Those who have already signed purchase agreements can still take delivery at the agreed price. But the prospective owners won’t accept that. If we need to compensate for the price difference, it won’t come cheap.”
Delivering at the New Tariff Rates
At 5:52 PM, less than two hours after the announcement by the State Council, the Tesla China CEO and Vice President announced on WeChat that the price of all undelivered vehicles will be reduced to the new tariff rate.
Witnessing the passionate “tear-filled” dialogue between the two executives, I was deeply moved, as are all the salespeople in the China region.
“If the bosses can do this, we’re willing to do anything!” said a delivery specialist to me.
The direct sales model showed its greatest advantage at this moment. Almost all Tesla China employees are excitedly spreading the news about “Prices of Model S and Model X adjusted with customer-first principle”.
For years, Tesla deliveries have been concentrated around the end of each quarter due to logistics reasons, a period that is commonly referred to as “end of quarter”. Currently, the total delivery volume of Model S and Model X in the China region for each quarter is approximately 5,000. There are still approximately 4,000 undelivered vehicles nationwide before July.
Just looking at the popular models Model S/X 75D/100D, the discount of about 50,000-60,000 yuan per car is calculated roughly, with an average of 55,000 yuan per car. Although these 4,000 Teslas cannot enjoy a tariff reduction, an average discount of 55,000 yuan per car is offered to users, resulting in a total of 220 million yuan.
It is important to understand that this company has reserved the smallest booth at the Beijing Auto Show, with almost no budget for market advertising, and the global VP only flying economy class. However, this year’s construction goal for supercharging stations will double on the basis of the previous one and will be open for lifelong use by old car owners.
If this is not customer-centric, then what is it?
Can this decision really be made in two hours?
I believe that all international car companies had prepared plans for tariff reductions of 5%, 10%, and 15% in advance, but major traditional automotive groups still need to go through a multi-level approval process in their management departments, and then observe and study each other:
It’s on the way.
Ultimately, this information needs to be passed on to dealers at different levels throughout the country. When this information is passed on to salespeople at dealerships, it is almost like this:
It is guessed that Tesla not only prepared plans in advance but also communicated with the US headquarters in advance about the feasibility of various situations, and undoubtedly optimized the approval process.
Or maybe it was just a phone call to Elon: “OK, Let’s do it!”
Been focused on customer-centered
After choosing a beloved car, paying a deposit, and waiting expectantly for three months…
The end of the story is not just “Congratulations to Mr. X for getting the car,” but the fairy Zixia, who grew up in traditional dealerships, would never guess this ending.The feeling of happiness of both receiving Tesla delivery and sales notification messages coexists. But there seems to be a really tangled thing in front of us: all the loans have to be re-approved.
Tesla in China has been vigorously promoting low-interest installment car purchases, with a financial coverage rate of over 90%. Since the start of the vehicle ordering process, all orders have been going through the approval process of major banks or financial institutions. Changing the price means starting the entire loan application process all over again, yes, all over again.
Helping the customers save tens of thousands of yuan without spending their own money is a feeling like, yes, there should be a (obedient Marxist.jpg) at this point.
Tesla owners are lucky, and understanding is mutual
Even though Tesla China has taken such timely measures to ensure customer experience, there are still customers who aren’t being taken care of, such as the owners who took delivery before May 22. We believe everyone understands their sense of loss at this time, luck is not just one time, but often does not coexist with vested interests.
Here, we are being responsible in reminding lucky owners that it’s the end of another quarter, and deliveries are expected to be as concentrated as ever.
After the tariff reduction, unlike traditional dealerships, the pressure on the retail channel has mainly shifted to the delivery function. By separating delivery into departments, it is a key part of Tesla’s entire direct sales model. Being in the Tesla delivery department often faces the problem of serving customers and taking on disputes and troubles caused by Tesla’s frequent changes and updates.
A delivery specialist delivers 8-10 vehicles in a day, and such an exaggerated volume is too common at the end of a quarter! This role requires eighteen martial arts skills in one’s possession, and summarizing complex trivial matters in the simplest way for customers: real-time logistics monitoring, close monitoring of loan approval and disbursement, promoting installation of home charging piles, confirming insurance processing, queuing for temporary license plates for new cars, processing formal license plates based on different local new energy policies…
However, what’s different from the past is that except for a few days’ customers expressing dissatisfaction with orders, most customers have expressed appreciation for Tesla. For newly delivered customers, they do bear a difference of tens of thousands of yuan only in a few hours/days. But in a mature service system, adherence to established rules better highlights a company’s fair and transparent attitude.
Finally, here is a bonus for the delivery experience:
Putting customers at the center, but there are often irresistible forces in the process.
Feeling a little bit of understanding and sympathy from the owners seems to be the best comfort.
The container ship quietly approached the three ports, and this time, the red scarf on the chest was even brighter…
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Within 3 hours of announcement of tariff reductions, Tesla has updated its prices for all models
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Which is more unreliable: Tesla, locally made, or Tesla, acquired by Apple?
This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.