Tesla Slashes Model S, X Prices in China After Model 3 Refresh

Tesla Slashes Model S, X Prices in China After Model 3 Refresh

Only hours after revealing an updated model of its mass-market Model 3 sedan, Tesla Inc. reduced the cost of its luxury Model S and X vehicles in China.

According to its official website, the American carmaker reduced the price of its entry-level Model X sport utility vehicle.

By nearly 18% to 738,000 yuan and its base Model S sedan by 14% to 698,900 yuan ($96,200) in Asia’s largest economy.

Only hours after revealing an updated model of its mass-market Model 3 sedan, Tesla Inc. reduced the cost of its luxury Model S and X vehicles in China.

According to its official website, the American carmaker reduced the price of its entry-level Model X sport utility vehicle.

Tesla Slashes Model S

The Model X Plaid and Model S Plaid, which have higher specifications, have had price reductions of 20.8% and 19.4%, respectively.

The modifications came after Tesla unveiled a revised Model 3 earlier on Friday. It is believed that this electric vehicle will help Tesla maintain its position in China despite fiercer competition.

Even though Tesla last month reduced the cost of a few high-end models that were in stock. Its China website still indicates that orders place right now will be fulfilled in the fourth quarter.

Tesla has learned that it must race faster than anybody else in the world to succeed in China’s very competitive EV market.

According to Bill Russo, a former Chrysler executive and current CEO of Shanghai-based consulting firm Automobility Ltd.

It will be “extremely tough” to maintain a higher price point for the new version and still sell sizable volumes, he added. Comparing selling a model that hasn’t been update in six years to purchasing an older iPhone in such a market.

Price reductions are your only option if you’re not the newest and greatest, he added.

Concerns that BYD, Xpeng, Nio, and other competitors could need to further reduce prices in order. Tesla’s higher-than-expected price for its revised, China-built Model 3 may help them maintain their order and sales momentum.

In July, deliveries from Tesla’s facility in Shanghai reached their lowest total for the year. 

Since then, Tesla has further lowered prices, raising fears of a reopened front. In a brutal price battle that has reduced profit margins.

Tesla Slashes Model S

Local rivals like Xpeng and the Zeekr EV brand of Geely Automotive Holding Ltd. have aggressively reduced costs and introduced.

New items to take on Tesla, while Nio has promised to roll out the first item under. Its new mass market brand as early as 2024.

The Model 3 was initially launch in March 2016 to great enthusiasm. But Musk infamously experienced many months of “production hell” as the business struggled to ramp up manufacturing in 2018.

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