Tesla loses fraud case in yet another image setback in China

Tesla and China romance hasn't been going too well in recent times with the American EV giant facing the heat for several reasons. The latest is Tesla losing a fraud case in a Chinese court in which a man had sued the company, alleging he had been sold a second-hand Model S which had previously met with an accident.

File photo of Tesla logo. (Reuters)
File photo of Tesla logo.

Han Chao had been very vocal on Chinese social media sites, accusing Tesla of selling him a Model S for 379,7900 yuan (approximately $58,700 or 43 lakh) but which may have previously been repaired after an accident. Chao had even referred to the company as ‘Rubbish Tesla' and ‘Rogue company’. The owner had even taken Tesla to court but was also sued in return for ‘tarnishing’ the image of the company.

Chao took to social media yet again recently to announce a Beijing court had found Tesla guilty and ordered the company to pay thrice the amount it had charged Chao. This comes to around 1.5 million yuan.

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The issue pertains to charges that there were signs of welding on the car which, Chao alleged, clearly showed the Model S had been repaired post an accident. Tesla is learnt to have denied that there had been any structural change in the said unit.

The court ruling now would come as yet another loss of face for Tesla China in a country that is powering its global sales. China is the world's largest auto market and Tesla opened its first production facility outside of US territory here a few years ago. The Shanghai facility manufactures Tesla cars not just for the local market but for international ones as well.

In recent times, Chinese customers have pointed to quality issues in their Tesla vehicles with one such owner even climbing on top of a Tesla car at a motor event. Authorities too are wary of Tesla and suspect the electric vehicles may transmit sensitive data to foreign shores using its cameras and radars. While Tesla China and CEO Elon Musk have both downplayed such concerns, many have been asked to park their Tesla vehicles away from key and sensitive installations.

(With inputs from Bloomberg)

First Published Date: 30 Sep 2021, 16:26 PM IST
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