Tesla Downgrades Hardware On "New" Model 3s In China, Then Delivers Them Anyway To Unsuspecting Customers

It looks like Tesla may have finally found a way to use up all of that old, unused inventory that's been sitting on the company's balance sheet: make new cars with old parts, and blame the coronavirus.

At least, that's exactly what it appears the company is doing in China, according to a recent report by Xinhua

On Tuesday, the news broke that Tesla was "downgrading" hardware on its China made Model 3 due to "supply chain status amid the epidemic" and it then promised free upgrades to its customers. Instead of just doing the right thing, which would be suspending production until you can make the product property, Tesla is doing what it does best: half assing it. 

The report points out that some Chinese consumers were noticing that the hardware in their newly delivered Tesla vehicles was inconsistent with their orders. Tesla responded by saying that Hardware 2.5 had been installed in some vehicles that were promised Hardware 3.0.

Isn't that a nice way to find out, as a consumer, that you're not getting what you ordered?

Elsewhere, this would look suspiciously like a bait and switch. And it appears from Xinhua's report that Tesla only fessed up after consumers started to take notice. We'd also be extremely interested in finding out when and how Tesla delivers on the promise of "free upgrades" for the customers taking delivery of their vehicles, with the wrong hardware, now.

The company's Gigafactory in China resumed work on Feburary 10. 

People on social media were skeptical - to say the least. But it seems as long as Tesla's stock holds up, Elon Musk will continue to get away with things like this. It's when the tide goes out on the stock that we're most interested in finding out what bubbles to the surface: