It looks like Tesla's price cuts in China have worked, at least for now. The company's China segment shipped 66,051 vehicles in January, according to Bloomberg, citing preliminary data released by China’s Passenger Car Association. In December, that number stood at 55,800.

The figure is up 18% from December, while China's new energy passenger vehicles, in total, are seen down 45% month-over-month from December to January. 

The company is now reportedly planning to increase output at its Shanghai plant - bringing its run rate back toward where it was in September 2022 - in order to continue meeting the demand from price cuts on its best selling models.

Tesla had suspended operations at its Shanghai plant for a portion of December. The EV maker was expected to halt production, but continued swirling questions about demand had surfaced after the company shut down operations at the key location earlier than expected. Back on Dec. 9, we wrote that the company was shutting down operations due to upgrades at the plant and waning consumer demand.

Meanwhile, looking at the broader scope of EV sales in China, domestic names like Nio, Xpeng, and Li Auto all recorded monthly and year-over-year sales declines in January, per Jalopnik. 

“Apparently, Tesla’s huge discounts [on its Model 3 and Model Y vehicles] siphoned off drivers’ buying interest in the Chinese-developed smart EVs. Overall, demand for expensive EVs appears to be weak, which could lead to price wars in the premium EV segment this year, "Gao Shen, an independent analyst in Shanghai, told SCMP.

Recall, as we wrote last month, Tesla has been dealing with a flood of protesters in both the U.S. and China, complaining about the company's recent swift price cuts. Customers were demanding rebates and credits, claiming that they had overpaid for the same cars that weren't marked down at the time they were purchased. 

Prices of Tesla vehicles in China are now between 13% and 24% lower than they were in September.  About 200 recent buyers of the Tesla Model Y and Model 3 made their way to a Tesla delivery center in Shanghai to protest.

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