From hero to zero, in just one month. Hong Kong has long been a hotbed for electric car sale, driven mostly by incentives, but what happens when those incentives vanish – almost doubling the cost of a new EV in some cases overnight? EV sales disappear….completely.
In March 2017, electric car sales in Hong Kong stood at 2,964 units. Come April, sales dropped to zero units. This was exactly as we had predicted when news first surfaced of the incentives being slashed.
Sales literally fell off a cliff and hit rock bottom. This will impact Tesla the most.The March sales figures show that out of the 2,964 EVs registered that month, all but 20 were either the Model S or Model X.
Under the new layout, the price of the Model S soared from HK$570,000 to more than HK$900,000.
The idea of the new tax structure is to reduce congestion in the city. It’s been pointed out that most people in Hong Kong who own a Tesla also own several other cars. Hong Kong thought it wrong to subsidize what it refers to as car collections.
However, we should point out that there’s been no tax increase on the purchase of your first gas car in Hong Kong, though subsequent purchase of additional cars are taxed. Barring any changes to the new tax setup, Tesla sales will suffer significantly, as will the sales of the remaining automakers who contributed to the other ~20% of EV sales in Hong Kong.