China’s Ministry of Industry and Information Technology included two versions of the sedan on a list of vehicles qualified for a 25,000 yuan, or $3,550, subsidy.
Why It’s Important For Tesla
The subsidy cuts the cost of Tesla’s pricy Model 3 — but not by much. In China, the car starts at $50,000.
Still, it closes the gap between Tesla and Chinese rival Nio Inc - ADR (NYSE: NIO). The electric vehicle makers are competing with BMW Group, which last week announced plans to construct its won EV plant, to claim space in the world’s largest electric car market.
After falling 6% Thursday, Nio’s stock traded up marginally Friday morning despite the positive development for its top competitor.
What’s Next For Tesla
Shanghai’s Gigafactory 3 is Tesla’s first international plant, and it’s a proving ground for local sourcing. Management began trial production before the end of October after having broken ground in January. The facility’s performance will testify to Tesla’s capacity to generate profits through factories abroad.
Tesla will begin delivery in China in January.
Tesla's stock traded around $334.57 per share at time of publication.
Nio Sustains Sales Momentum In November, Launches Third SUV
Tesla Begins China-Made Model Sales With Autopilot: Report
See more from Benzinga
- Elon Musk And Neil deGrasse Tyson Talk Physics Of Tesla Cybertruck, Ford F-150
- What Tesla Analysts Are Saying Ahead Of Thursday's 'Cybertruck' Event
- What To Expect From Tesla's 'Cybertruck' Event
© 2019 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.