Discussion » Questions » Science and Technology » What are your predictions for the Made in China Tesla?

What are your predictions for the Made in China Tesla?

Mine after a lifetime of experience with Made in China electronics and goods.

Posted - January 8, 2020

Responses


  • 1152
    This may be an apocryphal story, but I read once that Japanese manufacturers either founded a town or located in a Japanese town called Usa, so they could stamp "MADE IN USA" on their products, because the reputation of Japanese manufacturers in the world market (especially the United States) was so poor. Clearly that has changed over time.

    Recently, I purchased a Mazda automobile. Some units of the model I purchased were made in Mazda's Hiroshima plant, others were assembled in the Mazda-Toyota joint venture factory in Salamanca, Mexico. I ultimately purchased one made in Japan, but my research suggests there's essentially no quality/durability differences between cars made in either factory.

    In short, if Tesla built its Chinese factory to use state-of-the-art assembly technology and quality controls, and Tesla hired good workers whom they trained well, there is no reason the Chinese-built Teslas will be any worse than ones produced at any other Tesla factory.

     
      January 8, 2020 7:30 AM MST
    2

  • Chinese business and manufacturing always looks to cut corners and costs. Mislabeling parts and quality control stamps sorta thing.  The industrial philosophy over there is "  if they can't see it or don't know". 


    Japanese manufacturing was very, very poor in post war years.  Eventually they completely changed their systems because of the perception of low quality.  Which if you look at old Japanese products for the 50s and 60's..   Worse than China today.
      January 8, 2020 7:35 AM MST
    2

  • 1152
    I agree with you in part. I certainly have purchased plenty of items at the "dollar store" which meet the description of "cheap Chinese junk."

    But I was pointing out there's nothing inherent to China or Chinese businesses that make this so. As my example of the Mazdas illustrates, if a manufacturer tries to make a quality product, it can do so even in a location where cheap and shoddy is the expected norm.

    I don't know enough about Tesla to know how its Chinese-manufactured cars will turn out.
      January 8, 2020 8:38 AM MST
    1

  • Yes,  China is indeed capable of every spectrum of manufacturing quality.  It's not ability, it's integrity that is lacking.

      January 8, 2020 11:03 AM MST
    1

  • 1152
    There was an excellent article a few years ago (I think in Wired magazine) which described how the Chinese manufacturing sector works.

    There is MASSIVE overcapacity in manufacturing, so when the Chinese perceive a "hot new market" (the example in the article was hover boards) dozens of manufacturers scramble to find some segment to play in. Some assemble the boards. Some make parts for the boards. Some buy completed boards from others and repackage them to sell under their own brand name. Some do all of the above and more. And what any particular company does can change within the space of a week.

    When the next "hot new market" happens (e.g. selfie sticks), the players once again scramble to get a piece of the Next Big Thing.

    That's a very difficult business environment in which to produce quality products. Imagine if GE and Rolls-Royce were making microwave ovens this week, then aircraft engines next week, then cell phones 3 months from now. I think their aircraft engines wouldn't be nearly as good as the ones they've learned how to make by being in the business for several decades.
      January 8, 2020 11:23 AM MST
    0

  • 46117
    post WAR YEARS?

    They've   come a long way baby.  And what war are we posting about anyway?  World War II?


    Heaven Is a Made-in-China Tesla, But Only for Some

    Anjani Trivedi
    BloombergJanuary 7, 2020
    Heaven Is a Made-in-China Tesla, But Only for Some
    View photos

    (Bloomberg Opinion) -- The made-in-China Tesla has arrived. That’s getting investors excited about everything that goes into the electric vehicles — from valves and auto glass to headrests and seats. The enthusiasm for Tesla’s Chinese suppliers may be premature, though.

    Beijing has given Elon Musk all that the U.S. couldn’t: cash, concessions and cheap development costs. Tesla Inc.’s revenue from China accounted for about 11% of its total for the quarter ended September, up from 6% a year ago. Last month, Tesla secured an additional $1.6 billion loan from Chinese banks. On Tuesday, the Tesla chief executive officer was in Shanghai for a ceremony to hand over the first China-made Model 3 sedans to customers.

    China has been production heaven for Musk. Tesla’s capital expenditure for the Shanghai factory declined 65% on a unit production capacity basis compared with its U.S. manufacturing hub in Fremont, California, according to analysts at China International Capital Corp. The Shanghai plant was built in less than a year and can already produce more than 3,000 cars per week. Compare that to the depths of what Musk called his “production hell” in 2018, when he was sleeping on a couch or under a desk as the company struggled to meet a weekly goal of 5,000 cars in Fremont.

    That progress is fueling a rally in shares of Chinese suppliers. Take Zhejiang Sanhua Intelligent Controls Co., one of the country’s largest providers of heating, ventilation and air-conditioning components. Sanhua shares have risen more than 70% in Shenzhen since the middle of last year, as made-in-China Teslas came closer to becoming a reality. Shanghai Baolong Automotive Corp., which provides tire-pressure monitoring systems, has seen a similar advance over the same period; Ningbo Huaxiang Electronic Co., a maker of rear-view mirrors, has climbed more than 60%.

    Tesla will have to sell a lot of cars in China to justify those gains. The auto sector accounts for only a small portion of Sanhua’s revenue. Its valves, which help heating and cooling efficiency, contribute about 250 to 400 yuan ($36 to $58) to the value of a Model S and X, and about 1,000 yuan per Model 3, according to CICC analysts. Prices of the Model 3 will start from 299,050 yuan in China, Tesla said last week.

    Granted, Tesla isn’t the Chinese company’s only auto customer. It recently signed a 600 million yuan contract with BMW AG, and has contracts with other carmakers. That’s all cause for optimism. However, much of the excitement pushing up the stock lately has been driven by Tesla’s prospects. While this points to confidence in Sanhua’s valves (and the components produced by other suppliers), it doesn’t mean there will suddenly be huge demand.

    Tianjin Motor Dies Co., another maker of parts for Tesla, attributed “irregular” movements in its stock price to the U.S. company in a filing to the Shenzhen exchange on Tuesday as its shares jumped by the 10% daily limit. Tesla is no different from other customers including Mercedes-Benz AG and BMW, and its business with the U.S. electric-car maker carries “market development risk,” Tianjin Motor Dies said. The company’s shares have surged 28% this year.

    Meanwhile, China is scaling back subsidies for electric vehicles and plowing money instead into the infrastructure that will support them. Sales have been falling since the government reined in its largesse and are running below Beijing’s annual target of 2 million cars. Demand is uneven and significant barriers to adoption remain.

    Even if Tesla operates the Shanghai plant at its full capacity of around 150,000 cars, that won’t translate into a bonanza for suppliers. In addition, the subsidies that have helped the U.S. electric-car maker lower its prices could mean component makers soon start feeling pressure to cut their own prices.

    China’s electric-car sales targets will require more than 100 billion yuan of subsidies, according to estimates by Goldman Sachs Group Inc. analysts. That looks expensive, compared with the cost of past stimulus packages. The government may balk. After all, it knows all too well how helping favored industries too much can lead to overcapacity.

    The bottom line is that Musk’s Chinese plans lean heavily on government support. If any part of that falters, the rosy projections that have buoyed suppliers’ shares may implode. Under its agreement with the government, the U.S. company is required to make 14.08 billion yuan of capital expenditures and generate more than 2.23 billion yuan of annual tax revenue starting at the end of 2023, according to Tesla filings. The company says it can hit both those targets even if car production is “far lower” than what it has forecast.

    Story continues
     
     
    This post was edited by WM BARR . =ABSOLUTE TRASH at January 8, 2020 8:43 AM MST
      January 8, 2020 8:38 AM MST
    0

  • Chinese business and manufacturing always looks to cut corners and costs. Mislabeling parts and quality control stamps sorta thing.  The industrial philosophy over there is "  if they can't see it or don't know". 


    Japanese manufacturing was very, very poor in post war years.  Eventually they completely changed their systems because of the perception of low quality.  Which if you look at old Japanese products for the 50s and 60's..   Worse than China today.
      January 8, 2020 7:35 AM MST
    1

  • 32529
    Tarriff time. 
      January 8, 2020 7:33 AM MST
    1

  • One.  It wouldn't do any good if they were brought here.  Anyone who wants one is rich enough to absorb the tariffs and wouldn't care.


    Two.  The cars aren't intended for here.  They are intended for the Chinese and Asian market to get around tariffs.
      January 8, 2020 7:44 AM MST
    3

  • 1152
    True, but it will make "real Americans" feel good about "getting back at" the "people who stole our jobs." So some politicians will advocate for them in order to curry votes, even if they realize who dumb it is.
      January 8, 2020 10:22 AM MST
    0

  • Actually I'd find it hilarious.   Nobody struggling is buying a Tesla.  
      January 8, 2020 11:07 AM MST
    0

  • 1152
    True, but the US trade war with China has hurt many people who might be considered "struggling." I am most familiar with the information on the farming sector, where the US government has had to shell out over $20 billion to compensate farmers for losses due to tariffs making their products unsaleable in China.

    That'll show those bad Chinese people who stole our jobs....
      January 8, 2020 11:14 AM MST
    0

  • Yo be fair.  It is the Mexicans people think stole their jobs.   Which is BS.

    People think their jobs and American manufacturing independence  were sold off by multinationals to China.  Which is true.  

    I don't hear anyone saying the Chinese stole their jobs.
      January 8, 2020 11:36 AM MST
    0

  • 44175
    Now...to answer your question. I predict I won't buy one.
      January 8, 2020 10:19 AM MST
    0