Tesla Inc (NASDAQ:TSLA) traded up 1.8% Friday on reports that Model 3s produced at its Shanghai plant would qualify for Chinese subsidies.
China’s Ministry of Industry and Information Technology included two versions of the sedan on a list of vehicles qualified for a 25,000 yuan, or $3,550, subsidy.
Why It’s Important For Tesla
The subsidy cuts the cost of Tesla’s pricy Model 3 — but not by much. In China, the car starts at $50,000.
Still, it closes the gap between Tesla and Chinese rival Nio Inc - ADR (NYSE:NIO). The electric vehicle makers are competing with BMW Group, which last week announced plans to construct its won EV plant, to claim space in the world’s largest electric car market.
After falling 6% Thursday, Nio’s stock traded up marginally Friday morning despite the positive development for its top competitor.
What’s Next For Tesla
Tesla will begin delivery in China in January.
Tesla's stock traded around $334.57 per share at time of publication.
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