Tesla China's monthly deliveries in July fell more than 31% MoM to 64,285 vehicles, reaching a new low for the year.

According to the information obtained from the Zhongtong Finance APP, despite implementing price reductions and other incentives, Tesla (TSLA.US) is still struggling to attract buyers in China, with its car deliveries in China in July dropping to the lowest level this year.

According to preliminary data released by the China Passenger Car Association on Thursday, the company delivered 64,285 electric vehicles from its Shanghai Gigafactory in July, a year-on-year increase of 128%, but a decrease of 31.4% compared to June. It should be noted that the China Passenger Car Association did not provide a breakdown of local deliveries versus exports, but Tesla typically focuses on exporting overseas at the beginning of each quarter. The Shanghai Gigafactory has an annual production capacity of 1.1 million electric vehicles, accounting for over half of the automaker's global output.

It is understood that Tesla sparked a price war in China last year when the company lowered the prices of its Tesla models, prompting many of its increasingly powerful domestic competitors to do the same. However, this price reduction did not lead to a sustained buying frenzy in the Chinese market.

However, sales of Chinese electric vehicle startups have been growing recently. BYD (01211), with the highest sales volume, sold 262,161 new energy vehicles in July, a year-on-year increase of approximately 61.3%. Xiaopeng Motors (XPEV.US), which has signed an agreement with Volkswagen (VWAGY.US) to produce electric vehicles, delivered 11,008 vehicles in July, an increase of 28% compared to the previous month. Li Auto (LI.US) delivered 34,134 vehicles in July, while NIO (NIO.US) saw its deliveries surge to 20,462 vehicles.