Tesla Shanghai shown its highest pace inventory accumulation in October

While car manufacturers and market participants are preparing for a possible decline in the most significant car market of the world, the Tesla company demonstrated its highest pace of adding to electric car inventory in Shanghai last month, as it was shown by brokerage data.

According to information provided by China Merchants Bank International (CMBI), the company produced 87,706 Model 3s and Model Ys vehicles in Shanghai over the past month. At the same time, only 71,704 electric cars were delivered, thus adding the rest of 16,002 China-manufactured vehicles to the company’s inventory. 

As it was stated in the information by CMBI, that difference between production and sales became the most notable one since the very opening of Tesla’s factory in Shanghai by the end of 2019.

Although a number of vehicles in Tesla’s inventory is relatively small in comparison with other large car manufacturers, inventory accumulation has been considered a signal of a downturn within the industry that triggered markdowns in past recessions, all the while Tesla has had no relevant experience in such circumstances.

According to a statement made by Tesla’s CEO Elon Musk in October, China, while being the second-largest market for the company in the world, had experienced a "recession of sorts" last month. Meanwhile, The International Monetary Fund forecasts this year’s economic growth of China to be by 3.2% only, whereas the registered growth over the previous year was by 8.1%. The country’s government is also expected to cancel subsidies on electric vehicles and hybrids.