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A Chinese driver successfully sued Tesla for fraudulent purchases of second-hand Model S, which caused Elon Musk’s electric car pioneer to encounter a series of setbacks in one of its most important markets.
According to a copy of the judgment published by Han on his Weibo account, a Beijing court found that Tesla had misrepresented the condition of a car purchased by Han Chao for 379,700 yuan (58,700 US dollars) on the auto manufacturer’s official used car platform. The car was found to have undergone major repairs after an earlier accident, and the court rejected Tesla’s defense that the welding showed no “structural changes”.
According to a copy of the ruling issued by Han, Tesla was ordered to refund the cost of the car and pay compensation three times the purchase price-making the total compensation more than 1.5 million yuan. According to the local media Caijing, this is the first time that Tesla, headquartered in Palo Alto, California, has been fined such a large amount in China. The call to Beijing No. 2 Intermediate People’s Court was unanswered. As of 9:42 am New York time, Tesla shares fell 0.6% to $776.84.
Although Tesla has won a large number of loyal fans around the world, in China, it is also entangled with many dissatisfied customers, who use social media activities to win support. In the most high-profile case, a female customer climbed onto Tesla’s exhibit at the Shanghai Auto Show in April, and the protest spread quickly.
Poor publicity and increased regulatory review of safety, security, and customer service issues have ended Tesla’s honeymoon in China, including becoming the only foreign automaker permitted to wholly own its local business. China is the world’s largest electric vehicle market, and it is the key to Musk’s global ambitions and Tesla’s continued profitability.
Zhang Xiaoling, a partner of Beijing Haodong Law Firm, said: “This judgment can be regarded as a milestone in the protection of consumer rights against large companies.” “This case may increase the confidence of consumers facing similar situations and may Bring more followers,” she said. Zhang specializes in consumer rights law and is hearing another case against Tencent Holdings Co., Ltd., which will be heard in November.
Since the lawsuit was filed, Han has been a thorn in Tesla’s side. He used his Weibo account to continue to comment on his case and emphasize the dissatisfaction of others with the electric car manufacturer, including a Model X. The owner of the car, he also successfully sued for fraud after the electric car. The motor does not match the registration of his vehicle. The driver won a refund and received further damages equal to the purchase price.
In fact, the dispute between Han Han and Tesla has now become a legal tit-for-tat. After Han called the automaker a “rogue company” and accused the company of lying to the court on his Weibo account, Tesla is suing Han for damaging the limo and defamation. The automaker also said it will appeal the fraud ruling.
“We look forward to and believe that the court will eventually rule in accordance with the law,” Tesla’s legal team wrote in response to a local media Weibo post on the company’s official account. Except for these posts, the Tesla China office did not provide further comments.
In return, Han Zheng sued Tesla for defamation, claiming that Tesla portrayed him as the organizer behind the Shanghai Auto Show protests. Although he has been in contact with the woman, he said he did not participate in the protests. He said that Tesla is seeking compensation of more than 5.85 million yuan from him and is asking the court to freeze his assets.
Han, who declined to be interviewed, said on Weibo that he fought for 755 days.
“The principal will never be intimidated by unfair or strong competition, no matter how gorgeous or powerful it looks,” Han said in a post to his 120,000 fans. “Right is right. Wrong is wrong.”
(Updates to Tesla stock in the third paragraph.)
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