Tesla's China sales struggle to bounce back from an April slump

Tesla China-made Model 3 vehicles are seen during a delivery event at its factory in Shanghai, China January 7, 2020.

Aly Song | Reuters

BEIJING — Tesla's sales in China rose in May from the prior month, but failed to recover levels seen in March, according to the China Passenger Car Association.

Tesla sold 33,463 electric cars in May, up 29% from April's 25,845 units, data released late Tuesday showed. The number still fell short of March's 35,478 car sales.

The rebound in sales comes despite growing negative press and regulatory scrutiny on Tesla over customer reports of brake failures. The auto industry has also cut production due to a global shortage in chips.

Tesla shares fell 0.25% in the overnight New York trading session. The stock is down just over 14% for the year so far.

In May, Tesla shipped 11,527 vehicles from its Shanghai factory, lower than the 14,174 cars reported for April, the passenger car association data showed. Figures for March weren't available.

Overall sales of pure-electric cars more than doubled from a year ago, rising 186% to 162,000 units in May, the association said. Some in China's auto industry have cast doubt on the accuracy of the association's figures.

While Tesla's cars rank among the top 10 new energy vehicles sold in China, the report said local start-ups such as Nio also performed well in May. New energy vehicles include hybrid-powered cars.

The report said Volkswagen accounted for nearly half, or 48%, of new energy vehicle sales from mainstream joint ventures with foreign brands.

However, the report said luxury electric cars from Mercedes Benz, BMW and Audi have yet to see a major increase in customer purchases.

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