Tesla ignited a price war over a year ago by aggressively cutting prices at the expense of profit margins. (Tesla pic)
BEIJING/FRANKFURT: Tesla has cut prices in a number of its major markets, including China and Germany, following price cuts in the US, as it grapples with falling sales and an intensifying price war for electric vehicles (EVs), especially against Chinese EVs.
The price cuts come after Tesla, led by its billionaire CEO Elon Musk, reported this month that its global vehicle deliveries in the first quarter fell for the first time in nearly four years.
“Tesla prices must change frequently in order to match production with demand,” Musk posted on X on Sunday.
Tesla, the EV market leader, ignited a price war over a year ago by aggressively cutting prices at the expense of profit margins.
Tesla cut the starting price of the revamped Model 3 in China by 14,000 yuan (US$1,930) to 231,900 yuan (US$32,000), its official website showed on Sunday.
In Germany, the price of the Model 3 rear-wheel-drive was trimmed to €40,990 from €42,990, where the price had been since February.
There were also price cuts in many other countries in Europe, the Middle East, and Africa, a Tesla spokesman said.
US prices of the Model Y, Model X, and Model S vehicles were cut by US$2,000 on Friday. On Saturday, Tesla slashed the price of its Full Self-Driving driver assistant software to US$8,000 from US$12,000 in the US.
Tesla has been slow to refresh its ageing models as high-interest rates have sapped consumer appetite for big-ticket items, while rivals in China, the world’s largest auto market, are rolling out cheaper models.
This weekend, Musk postponed a planned trip to India, where he was to have met Prime Minister Narendra Modi, citing obligations at Tesla. The trip was to have included the announcement of plans for Tesla to enter the South Asian market, Reuters reported on Saturday.
Musk said last Monday that Tesla will lay off more than 10% of its global workforce as the automaker braces for its first annual drop in deliveries.
The announcement came after Reuters reported on April 5 that Tesla had scrapped plan to develop its long-awaited affordable EV in favour of robotaxis. Musk posted that “Reuters is lying” after the report, without citing any inaccuracies. He has not spoken further about the model, leaving investors clamouring for clarity.
Tesla shares have fallen 40.8% so far this year.
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