China defies Tesla's pride

The latest storm to hit Tesla began on Monday with a young Chinese woman on the roof of one of the American firm's models at the Shanghai auto show.

"The brakes don't work," he yelled as dozens of mobile phones swarmed around him recording the action.

Viralized the images, the car manufacturer controlled by Elon Musk has had to face its umpteenth crisis in which the media close to the Chinese government have accused it of "arrogance" in its dealings with customers, while one of its executives hinted that behind the protest, some other interest might be hiding.

Far from losing value, Tesla shares have taken the hit with a rebound this week of 0.9% despite the repercussions that the case may have on a market, the Chinese, which already weighs around 30% in its sales.

However, the reputation of the brand is once again in question.

Like when Texas police found a Model S crammed into a tree last Saturday with two lifeless people in it and neither of them at the wheel, as if it had been the result of the automatic driving system.

Or when Musk himself smashed the window on his Cybertruck prototype after saying the glass was unbreakable.

More information

• Tesla drives between wealth and doubt

• Why China is leading the electric car race

The cases marked by controversy have been continuous and, as Albert Gallegos, director of international relations for the American Automobile Dealers Association, says with some irony, "the fault is always the customer, never their cars or technology." "Their policy is quite arrogant and it has already happened on several occasions that they get rid of the problem," he adds. In the case of the young Zhang Yazhou, external pressure has forced an act of contrition by daily chapters.

This correction in the way of responding to the protests has not meant a change in strategy in the defense of its technology. The vehicle, a Model 3 driven by the protester's father, was traveling at 118.5 kilometers per hour and braking to 48.5 kilometers before suffering an accident, according to data that Tesla has offered to the Chinese authorities in an attempt to shelve the matter and save your image. According to the monitoring of the vehicle, in the last half hour before the impact the brakes would have been applied around 40 times, data that Zhang doubts, after months of arguing with the brand about an alleged failure in the brake system. “They may be right, but you cannot answer how they have responded. That is the great difference between Tesla and the rest of the car brands: the way to deal with these cases ”,explains Juan Felipe Muñoz, analyst at the automobile consultancy Jato.

Tesla is profiting from its commitment to the Chinese market, where it has been manufacturing cars since 2019 and has become an exception: it has not landed in China with a local partner, as other foreign brands have historically done. Competition is fierce at the world's largest electric vehicle dealership, with a multitude of local manufacturers and the watchful eyes of the government for the slightest bit of unfair competition. In the first quarter of this year, the Californian group has managed to sell 69,600 cars there, almost four times more than in the first quarter of the previous year.

But in China it suffers from the same problem that it has proven to have in the United States or Europe: the lack of a vast network of dealers and after-sales points to facilitate customer-seller communication.

The company's chief financial officer, Zach Kirkhorn, admitted this in January: "The expansion of services is really important for the future strategy of the company," reported Reuters.

"If you skip the dealership, you expose yourself to the customer wanting to treat you directly and do what the girl did in Shanghai because she has nowhere to turn," says Muñoz.

“Not having dealerships is going to generate problems for them, because now the rest of the brands come with electric cars after they have been alone for seven years.

And all are supported by dealerships.

What are potential buyers going to do? ”Asks Gallegos.

"The strange thing is that they had no more problems"

Some European brands have chosen to delay the launches of their electric vehicles due to flaws in the development of their software.

Tesla, on the other hand, has not yet admitted errors in its technology.

Esade's professor of operations and innovation, Esteve Almirall, does not consider that the problems Tesla is having are so serious.

“Its technology is superior, but it has the disadvantage of its profound difficulty.

The strange thing is that they have not had many more problems, "he says, assuming that this technological vanguard exposes Elon Musk's company to more accidents than other traditional brands.

Almirall considers, however, that behind the complaints in China there is “an economic nationalism that wants to impose local manufacturers at the head of the market”. Muñoz believes that the Shanghai case shows a certain "oversizing", although he also blames the brand for not being able to "recognize errors" in its products.