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Tesla says it will take trade-in vehicles toward Model S purchases in China. Despite its recent stock slump, analysts are bullish on Tesla for 2015.
- Gina Hall, Contributor
Tesla is making inroads in the world's largest car market — China. The high-end electric car maker will assist Chinese buyers with trading in their vehicles if they purchase a Tesla Model S.
The Elon Musk-led manufacturer will engage with used-car traders in locations such as Beijing, Shanghai and Hangzhou, according to a statement from the company. Consumers can deduct the value of their old car from the purchase of the Model S, which has a starting price of 648,000 yuan ($104,000).
The company brought the Model S to China in April and expects to be assembling the cars within China in the next three to four years, according to Bloomberg News.
The Palo Alto-based company has nine stores and service centers in six Chinese cities and nearly 700 power points in 70 Chinese cities, the largest network outside of the U.S. Tesla will build more charging stations around the country in partnership with China Unicom and Soho China Ltd.
Earlier this month, the company ousted its head of China operations Veronica Wu after less than one year in the position. Around the same time, the company saw its stock drop 14 percent after a sharp drop in gasoline prices reportedly made a dent in consumers' interest in the company's electric vehicles.
However, analysts are bullish on the company, claiming its stock will rebound in the new year. Pacific Crest analyst Brad Erickson wrote in a recent report that Tesla's stock price will rise to $316 over 2015. The stock is currently trading at $223.
"While TSLA is a momentum stock, investors have been baking in that lower oil prices will be certain to reduce demand for electric vehicles, regardless of pricing," said Erickson.
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