Tesla (NASDAQ: TSLA) announced last Friday that a customer who purchased a discounted Tesla Model 3 on popular group-buying platform Pinduoduo will not have his order fulfilled by the carmaker, which has claimed the purchase violated its terms and conditions that forbid reselling. The e-commerce platform, which confirmed the news in a separate announcement, saw five customers take part in the highly-publicized sale.
The Tesla car sale, which began in July, was offered by a Chinese car dealership group on the platform called Yimaiche. The group-buy event offered five China-made Tesla Model 3 cars for RMB 251,800 (USD 35,946), which is RMB 40,000 (USD 5,710) lower than the original price. In addition to subsidies for new energy vehicles from the government, Pinduoduo and Yimaiche paid nearly RMB 20,000.
Soon after Pinduoduo launched the promotional campaign, the California-based EV maker denied its involvement through microblogging site Weibo, as KrASIA reported. However, the platform held the flash sale on July 26 as planned.
On August 14, the dispute intensified, as a buyer in Wuhan, Hubei province, reported that Tesla refused to fulfill the contract. The EV maker claimed that this batch of Pinduoduo users violated terms and conditions, leading to a termination of his contract. While these buyers paid Pinduoduo for their cars, the platform bought the vehicles from Tesla’s website on their behalf using their personal information.
According to local media reports, the buyer, who is from Hubei, plans to sue Tesla.
However, another Pinduoduo user who bought the car reportedly received his order without issues. No further information is available on the status of the other three Models 3’s in the sale, or how Tesla tied the buyer’s information to the Pinduoduo event.
On the morning of August 17, Tesla told local media outlet Sinatech that it supports customers who are misled by group-buy events and it will provide them with necessary legal aid. “If consumers are willing to place new orders through Tesla’s official website, we will provide compensation for the loss of time and energy,” the company said in the written response to the media outlet.
“Tesla has always adhered to a direct-selling model because we believe it is in every customer’s best interest,” the company added.
Pinduoduo, which first gained prominence in lower-tier cities, has been diversifying its user base in competition with Alibaba and JD.com by offering more branded products while maintaining steep discounts. But the aggressive discounts sometimes cross brands which are unwilling to participate. Last year, high-end cosmetics label La Mer listed all authorized dealers and platforms on Weibo—excluding Pinduoduo—after the platform offered discounted facial creams.