Tesla Gets 300 Orders for Model S in Hong Kong

By · July 08, 2013

Model S

Tesla reports healthy pre-sales in Hong Kong, with over 300 orders ahead of the car's launch there this winter.

Enclosed by the Pearl River Delta and South China Sea, the former British colony of Hong Kong is known as a world-leading financial and high-tech center—so it’s hardly surprising that its residents show a penchant for luxury, tech-filled cars. When electric automaker Tesla recently opened the official order books for its Model S Sedan in Hong Kong, it was inundated with orders for the luxury all-electric car due to go on sale there this winter. Tesla said sales of the Model S will double the number of privately-owned electric cars on the roads of Hong Kong by the end of the year.

“Our number is over all electric cars in Hong Kong combined,” Kenneth Lui, Hong Kong sales manager for Tesla, told Bloomberg last week. The pre-launch popularity of the Model S in Hong Kong is good news to software engineer and Hong Kong resident Mark Webb-Johnson. Founder of the Open Vehicle Monitoring System (OVMS) project and daily driver of a Tesla Roadster, Webb-Johnson said it looks as if EV sales in Hong Kong are following a similar growth curve to the U.S.

“Figures for 2013 so far in the U.S. seem to indicate a doubling of plug-in sales 2013 vs 2012 (on top of the doubling 2012 vs 2011),” he wrote in an email to PluginCars.com. “There were something like 86 EVs in Hong Kong in 2011, so it looks like the pattern is similar.” For years, Webb-Johnson said, automakers have denied the existence of a market for plug-in cars.

Hong Kong—which retains a great deal of legislative and judicial autonomy from the People’s Republic of China of which it is part—doesn’t offer direct purchase rebates or tax credits to those buying EVs. However, EVs are exempt from First Registration Tax, a one-off fee which can be as high as 100 percent the purchase cost for large, polluting gasoline vehicles. Similarly, the yearly license fee, which can be in excess of $1,000 for luxury gas-guzzlers, is less than $50 for EVs.

All of Hong Kong’s fuel is imported, so there’s a high gasoline tax of around 100 percent which is levied each time you fill up with gasoline, while electricity in Hong Kong is relatively cheap, and is delivered by a well-maintained and reliable electrical grid.

It’s possible to drive around the entire territory (about 125 miles) on a single charge in a Model S. Standard electrical supply is 220-volt power, even from common wall outlets.

Tesla’s successes notwithstanding, Hong Kong still has major hurdles to overcome before EVs are considered mainstream vehicles. First, there’s the issue of price. While EVs are exempt from F.R.T., those who opt for EVs are often victims of price gouging. Last year, 200 Nissan LEAFs were imported to Hong Kong from Japan, at a price of $53,500 each. Meanwhile, Webb-Johnson said his Tesla Roadster was about 25 percent more expensive to buy in Hong Kong than it would have been in the U.S.

Second, there’s still work to be done on Hong Kong’s power mix. Like mainland China, Hong Kong relies heavily on fossil fuels for its electricity. Electricity is imported with an overwhelming percentage (77 percent) produced from coal-fired and natural gas power stations. While China is trying to clean up its energy grid, there are no solar feed-in tariffs available for Hong Kongers and roof-top photovoltaic systems are rare.  Meanwhile, concerns over nuclear safety jeopardize Hong Kong’s 2020 target power mix of generating at least 50 percent of its power from nuclear power plants.

Nonetheless, Webb-Johnson is positive about Hong Kong's clean energy future.  Provided the government keeps its current incentives, which are due to expire next year, Webb-Johnson said EV sales in Hong Kong should continue to grow at a steady rate.

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