San Francisco, CA – Electric vehicle giant Tesla has slashed prices in key markets such as the US, China, and Germany amid a fierce price war with other electric vehicle manufacturers. The price cuts come as Tesla, led by billionaire Elon Musk, grapples with declining sales.
Competition in the electric vehicle industry, especially from Chinese companies, has been heating up. Tesla is set to disclose its financial results for the first quarter of 2024 after the US market closes on Tuesday.
In China, Tesla reduced the starting price of the Model 3 by 14,000 yuan to 231,900 yuan. Similarly, prices of the Model Y, Model X, and Model S vehicles in the US were lowered by $2,000 on Friday.
Tesla also implemented price reductions in various countries across Europe, the Middle East, and Africa. The company had previously initiated an electric vehicle price war by significantly cutting prices to boost sales, even at the expense of profit margins.
While Tesla has been slow to update its existing models, rivals in China like BYD and Nio have been introducing more affordable models. The competition intensified last month when Chinese tech company Xiaomi debuted its first electric vehicle.
Over the weekend, Elon Musk announced a postponement of his planned trip to India, citing “very heavy Tesla obligations.” Additionally, Tesla issued a recall for thousands of its new Cybertrucks due to safety concerns related to accelerator pedals potentially getting trapped by interior trim, raising the risk of accidents.
With Tesla’s shares plummeting by over 40% since the beginning of the year, the company faces significant challenges in the increasingly competitive electric vehicle market.