Tesla Drops 3% After Price Cuts Announced in China

https://tokenist.com/tesla-drops-3-after-price-cuts-announced-in-china/

Tesla is implementing significant price reductions for its vehicles in China, following a substantial 31% drop in sales for July from the previous month. To counter the downturn in the world's largest automotive market, Tesla has trimmed the starting prices of its China-made Model Y long-range and performance models by 14,000 yuan (around $1,900), a reduction of 4.5% and 3.8% respectively. Additionally, the automaker will offer insurance subsidies of 8,000 yuan for entry-level, real-wheel-drive versions of Model 3 cars, available between Aug. 14 and Sept. 30.

The move comes amidst a broader global decrease in demand for electric vehicles, and local competitors such as BYD regaining market share with more favorable pricing. Sales of Tesla’s China-made cars have been on a decline since the end of 2022, although the automaker did see a 31% year-over-year increase in sales in China in February 2023.

Despite the decline in China, Tesla's global vehicle deliveries in Q2 2023 hit a record high of 466,100 units, a quarter-over-quarter increase of about 10.23%. The announcement of the price cuts led to Tesla's stock falling over 3% in premarket trading, reflecting investors' concerns over the sales slowdown in a key market for the electric vehicle maker.