Tesla reviewing strategy in China, may close mall showrooms to increase service: Report

Tesla China store

Tesla has seen rapid growth in China since opening its first retail store in Beijing in 2013, now with over 200 locations across the country and its very own Gigafactory.

As their growth continues the company is reportedly taking a second look at its strategy to improve sales and service in China.

According to a report by Reuters, citing sources familiar with the automaker’s plans, Tesla is considering shutting down some of its retail locations in expensive malls.

The reason for this possible change is the expensive rent in high-end malls, and that these malls have seen a substantial drop in foot traffic since COVID-19.

The report did not specify how many stores Tesla was considering closing. However, a review of Tesla’s website shows more than half of Tesla’s showrooms in China’s seven biggest cities are in the downtown area.

Another reason is that these locations do not service vehicles, something that is becoming more important for Tesla as more and more cars hit the road each month in China.

Instead, the company will shift focus to more suburban locations that offer more space and cheaper rents.

Tesla may have already started hiring in preparation for this potential increase in Service locations. The Tesla Careers website in China currently has over 300 job postings for service-related positions.

The shift in focus could also be related to CEO Elon Musk’s recent penchant for improving service. In recent tweets Musk said he was personally working to make Tesla Service “awesome” with a goal of having more than 50% of service appointments completed within one hour.

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Founder and Editor-in-chief of Drive Tesla Canada | Darryn@DriveTeslaCanada.ca Have a Tesla tip? Email tips@driveteslacanada.ca, or DM us on Twitter @DriveTeslaca