China-based businesses have been sinking money into various automotive operations—from glass and tire makers to technology developers and car makers—for several years, reflecting Beijing’s goal of eventually dominating the world’s car business. That effort accelerated during the first half of 2017, with eight overseas deals totaling more than $5.5 billion in Chinese investments, compared with nine investments for all of last year. The list includes the takeover of troubled Japanese air-bag maker Takata Corp. , the purchase of a U.S. flying-car developer and the acquisition of a sizable stake in Silicon Valley’s Tesla Inc. TSLA 1.43% by games and social-media company Tencent Holdings Ltd.
Tesla Inc.’s sales in Hong Kong came to a standstill after authorities slashed a tax break for electric vehicles on April 1, demonstrating how sensitive the company’s performance can be to government incentive programs. Not a single newly purchased Tesla model was registered in Hong Kong in April, according to official data from the city’s Transportation Department analyzed by The Wall Street Journal. In March, shortly after the tax change was announced and ahead of the April 1 deadline, 2,939 Tesla vehicles were registered there—almost twice as many as in the last six months of 2016.
Upscale jeans maker True Religion Apparel Inc. said Wednesday that it filed for bankruptcy reorganization, making it the latest Southern California apparel firm to falter as people embrace online shopping. But True Religion said that in tandem with filing under Chapter 11 of the bankruptcy laws, its owner, TowerBrook Capital Partners, a private equity firm, reached a proposed deal with lenders to slash True Religion’s debt by about three-quarters as it continues operating.
Tesla Inc. shares took a beating on Wednesday after several analysts questioned whether customer demand for its two electric vehicles is waning as the company begins producing a cheaper sedan. The Silicon Valley auto maker’s shares fell nearly 5% in midday trading to $335.74—the lowest point in more than a month—after rising about 69% this year through last week on enthusiasm for the coming Model 3 sedan, which is central to Tesla’s plan to sharply increase total sales. Tesla on Monday reported sales of its Model S cars and Model X sport-utility vehicles were lower than analysts expected because of a supply issue with battery packs, raising new fears the company will have trouble meeting ambitious production targets for the Model 3.
Elon Musk has announced the rollout of the Tesla Model 3, which he claims is the car for the masses. But what he really means is that it is a car paid for by the masses. Tesla prominently features the various incentives and credits available to prospective buyers. Purchasers of the $35,000 Model 3 get a $7,500 tax credit—21 percent. In addition, some states provide tax credits or rebates that can range from $1,000 to $5,000, with Colorado at the high end. Plus, owners of electric vehicles (EVs) often get to use HOV lanes without charge, free parking, and rebates on home chargers.