Tesla’s latest move comes after China ended its decade-long EV subsidy on December 31.
US electric vehicle (EV) maker Tesla cut the prices for all its Model 3 and Model Y cars in China for the second time in less than three months. The automaker’s decision has triggered forecasts of an impending price war amid a global slump in the auto market.
According to calculations made by Reuters based on the website prices, Tesla slashed prices for all its Model 3 and Model Y cars in China by between 6% to 13.5%. The starting price for the Model 3 was cut to $33,427 (229,900 yuan), from $39,281 (265,900 yuan). Those models are now priced 24% to 32% lower than those in the US which is Tesla’s largest market.
Data from the China Passenger Car Association (CPCA) showed that Tesla delivered only 55,796 China-made EVs in December, the lowest in five months.
Tesla’s latest move comes days after Beijing ended a decade-long subsidy programme for EVs prompting EV automakers to increase discounts to maintain sales as demand eases. While rival EV automakers such as BYD and SAIC-Volkswagen have raised prices for some models, most of them have opted to absorb most of the cost of the subsidy.
Tesla also cut Model 3 and Model Y prices by about 10% each in Japan, the first time it had done so since 2021.
In addition to the discounts offered in China and Japan, Tesla has started offering discounts to EV buyers in Singapore who agree to purchase the existing inventory of the Model 3 or Model Y. Tesla is offering a discount of $5,000 for EV purchasers who trade in an existing internal combustion vehicle and another $5,000 credit against the cost of the certificate to operate a car in Singapore.