Tesla Inc (NASDAQ:TSLA) sold just 32 cars in Hong Kong in the final nine months of 2017 as the government in the Chinese territory put a cap on generous tax breaks.
Hong Kong was once dubbed a “beacon city” by Tesla’s billionaire founder Elon Musk, who had previously stated it was the city with the highest number of Tesla cars per capita.
Teslas are a constant sight on Hong Kong’s roads, with the tax breaks buoying sales of the electric cars in recent years.
Tax breaks slashed in March
But Hong Kong authorities slashed those waivers last March, which almost instantly doubled the price of a Tesla Model S 75D to US$132,000.
As a result, only 32 Teslas were registered in the city between April and December last year, down from almost 2,000 in the same period of 2016.
Other jurisdictions, such as Denmark, have also seen sharp declines in sales shortly after the removal of tax breaks.
Online reports claim that Elon Musk has sent a letter to Hong Kong chief executive Carrie Lam, warning that his firm would reduce its presence in the territory if previous tax credits for electric car buyers were not reinstated, although Tesla itself hasn’t commented on this.
Sales in first three months were good though
Last year wasn’t a complete disaster for Tesla in Hong Kong, though.
A total of 2,939 Teslas were registered in March as customers raced to get their hands on electric cars before the waiver cap came in to force on April 1.
That was more than the 2,807 vehicles that the company sold in the whole of 2016.
Tesla’s stock was down 2% to US$337 in pre-market trading.
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