Electric vehicle giant Tesla has made a significant move in the Chinese market by halting new orders for its luxury Model S and Model X cars on its official Chinese website. While visitors can still view details of the two models, the option to place an order has been removed. This decision appears to be a direct consequence of the escalating trade conflict between the U.S. and China, which has particularly impacted high-end American imports.
Luxury Models Lose Ground in China
Both Model S and Model X are imported directly from the United States, which subjects them to increasingly high tariffs. Recent decisions by the Chinese government have raised the import tax on U.S.-made goods to as much as 84%, severely limiting Tesla's competitiveness in this segment. Combined with already limited interest in these expensive models, the added cost has further diminished consumer demand.
Long Delivery Times and High Costs Drive Consumers Away
Previously, delivery times for the Model S and Model X in China ranged between 3 to 8 months. For Chinese consumers who prioritize quick delivery and cost efficiency, this has proven to be a major drawback. Coupled with the steep tax hikes, these delays have significantly reduced the appeal of Tesla’s flagship models.
Model 3 and Model Y Orders Continue Unaffected
On the other hand, production and sales of the more affordable Model 3 and Model Y remain unaffected. These models are built at Tesla’s Gigafactory in Shanghai, allowing the company to avoid heavy import taxes and meet demand efficiently. As a result, these models continue to dominate Tesla’s sales in the region.
Tesla’s Q1 2025 Performance
In the first quarter of 2025, Tesla delivered a total of 336,681 vehicles, of which 323,800 units (around 96%) were Model 3 and Model Y. Deliveries of Model S, Model X, and the Cybertruck were limited to just 12,881 units. These figures highlight Tesla's growing focus on more affordable, mass-market models over its premium offerings.