Home 2. TOPIC Clean Disruption News: Elon Musk launches Tesla electric vehicles in Dubai

Clean Disruption News: Elon Musk launches Tesla electric vehicles in Dubai

Clean Disruption News: Elon Musk launches Tesla electric vehicles in Dubai

Dubai’s petrol-guzzling supercars will soon face greener, healthier competition. 

Tesla co-founder and chief executive Elon Musk launched the company’s electric vehicles in the United Arab Emirates yesterday. This was the Californian company’s first foray in the ­Middle East, which is potentially a big market for its luxury cars and sports-utility vehicles.

The electric car maker will ­accept online orders for its Model S sedan and Model X SUV, Tesla said in a statement, deliveries of which are expected to start this northern summer. It said the launch of its online platform in the UAE would be supported by a pop-up store in the Dubai Mall, with a service centre in Dubai ­expected to open in July. The company will then open a store and service centre in Abu Dhabi in 2018.

Tesla is among the world’s fastest-growing car manufacturers, with sales rising 27 per cent on the year in the fourth quarter of 2016. It still fell narrowly short of its goal of delivering at least 80,000 vehicles in 2016, mainly due to delays related to new hardware for Autopilot, the semi-autonomous driving feature.

Mr Musk, who is the chairman and largest shareholder of Tesla, has said the company will make 500,000 cars a year by the end of 2018 and one million vehicles in 2020.

Dubai and the broader Middle East potentially offer a big market for Tesla’s relatively pricey cars.

The emirate and its rich oil-producing neighbours in the Persian Gulf are big buyers of powerful, fancy vehicles every year. That addiction has been helped in large part by heavily subsidised fuel in most of the ­region. However, as oil prices have fallen sharply since the middle of 2014, many governments have cut fuel subsidies, which will make petrol-powered cars more expensive to operate. And many governments, such as Dubai, are also encouraging the use of more environmentally friendly cars, such as those made by Tesla.

Tesla also faces challenges. A majority of people in the UAE, of which Dubai is a part, and most other Gulf countries are expatriates who prefer cheaper cars that have good resale value.

And Tesla needs to deploy charging stations quickly to cater to a region where personal vehicles are still the most popular mode of transport.

Tesla yesterday said prices would start from 275,000 UAE dirhams ($97,000) for Model S and 344,000 dirhams for Model X.

The company has already deployed several charging stations in the UAE and will add many more by the end of 2017, it added.

The company is also rushing to complete work on the Model 3, a sedan with a base price tag of $US35,000 ($45,000) that will help broaden its cars’ appeal to the masses. Production begins mid-this year and delivery estimates for new reservations are mid-next year or later, according to the company’s website.

Mr Musk has set ambitious targets for Tesla, especially on ­deliveries, which will help maintain investor confidence in the company. But he also faces ­several questions on his projections, be it on car-production output or financial targets.

Mr Musk unveiled Tesla’s plans for the UAE at the high-profile World Government Summit in Dubai this week, according to social media posts. Only local media were invited for the media conference.

SOURCE: The Australian Business Review