Photo: Business Wire

Tesla intends to reduce the number of showrooms in shopping centers in first tier cities in China. At the same time, the company will replace them with 4S stores, which combine a wide range of services from sales to after sales.

A source from the CBS via Pandaily reports that Tesla intends to reduce the number of its stores in Shanghai from 19 to about 10. This step is due to the fact that the company's cars have already become very popular in China, so placing showrooms in places with high traffic has become unnecessary. In addition, the company intends to significantly enhance the customer experience in purchasing and after-sales service by offering a wide range of services in one place, which is very convenient.

“Tesla plans to build 1 or 2 outlets similar to 4S stores in each district of Shanghai. The company is looking for venues near the city’s automobile business district, and plans to negotiate with many investors from traditional automobile dealers with the intention of renting their venues. The front exhibition hall will be for experience and sales while the back venue will be for maintenance,” said a person familiar with the matter.

The new stores will combine showroom, sales, delivery, service, test drives, and owner training. Customers will be able to get it all in one place, which can provide greater confidence and ease of ownership.

In addition, the new stores will help reduce the company's cost of renting high-value premises in malls. Previously, such places were leased to catering chains or clothing stores, so they had a low cost. But that changed over time as new, Chinese car makers began to actively lease stores in shopping malls, leading to an increase in rental costs.

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