Tesla slashed prices in key markets like China, Europe, and the US, signalling a global pricing adjustment. With sales declining and Chinese EV competitors rising, the company cut its EV pricing to stay competitive.
Interestingly, Tesla, in almost four years, registered its first drop in global vehicle deliveries during the first quarter. According to Musk, fluctuating prices are necessary to match the company’s production with market demand.
Also, Elon Musk postponed his scheduled visit to India, where he was set to meet with PM Narendra Modi.
Tesla revealed a substantial price reduction for its Full Self-Driving (FSD) software, slashing its price to $8,000 from $12,000 in the US.
Moreover, the company’s valuation has been significantly influenced by its dedication to the development of fully autonomous vehicles. Also, the EV maker has announced plans to unveil a dedicated robotaxi on August 8th.
As a bonus, new vehicle buyers will receive a 30-day trial of the FSD software at no extra cost. However, Tesla’s current features mandate active driver supervision and do not achieve full vehicle autonomy.
Tesla reduced prices in China across its model lineup, with the updated Model 3 now priced at 231,900 yuan (₹26.6 lakh). Previously, the model came with a price tag of 245,900 yuan. Also, the Model Y faced a price cut, falling to 249,900 yuan (₹28.7 lakh) from 263,900 yuan.
In the US, the base Model Y now starts at $42,990, marking its return to the lowest price level. Moreover, the EV giant slashed prices by $2,000 for the premium Model Y variants.
In addition, the Model X is now available at its most affordable price yet, with a starting price of $77,990.
However, the company didn’t reduce the prices for the Model 3 and the Cybertruck in the U.S.
Amid a turbulent week, Tesla slashed prices after CEO Elon Musk announced a global workforce reduction of over 10%.
Shockingly, this year, the company’s stock has plummeted by more than 40% year-to-date. The decline in sales amidst rising competition, notably from China, is a matter of significant concern for the EV maker.
According to Bloomberg, company’s market share in China dropped to approximately 6.7% in Q4 2023, down from 10.5% in Q1.
However, Tesla maintains its dedication to innovating and expanding in the electric vehicle market despite these obstacles. The price reductions signify the company’s response to market shifts, inventory management, and competitiveness in critical regions.
