Tesla Model Y Features On Chinese Government's Purchase List In A First For Elon Musk's Company

A local government in China has reportedly included Tesla Inc.’s TSLA Model Y SUV among the list of electric models that it could buy as a service car.

What Happened: The Eastern Jiangsu provincial government listed the Model Y among other Chinese-branded EVs and hybrids in addition to the Volvo XC40, local news outlet The Paper reported. Volvo, however, is owned by China’s Zhejiang Geely Holding Group.

As per the report, this is the first time that Tesla cars have been ascertained eligible for government purchase in the country.

The Model Y is Tesla’s best-selling vehicle. It starts at 249,900 yuan (about $34,387) in China with the more premium performance all-wheel drive version starting at 354,900 yuan (about $48,835)

Earlier in May, China greenlit another big Tesla factory for a megapack project.

Why It Matters: Tesla delivered 443,956 vehicles in the second quarter globally, marking a 4.8% drop from last year but still beating the consensus estimate. Tesla’s mass-market offerings, the Model 3 and Model Y, account for a majority of these deliveries.

While Tesla does not segment its deliveries by geography, a previous report said that the EV maker cut Model Y’s production from the Giga Shanghai facility by a double-digit percentage since March.

Price Action: Tesla shares closed up 6.5% at $249.39 on Wednesday. The stock is down 0.8% year-to-date, according to data from Benzinga Pro.

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