Automotive and clean energy company Tesla has slashed the price of its vehicles in China following an unimpressive financial report.
Tesla’s recent Fourth Quarter (Q4) financial report, which revealed lower-than-expected worldwide vehicle shipment numbers, forced it to reduce the prices of its model 3 and model y vehicles in China.
The company reported that 405,278 vehicles were delivered for the Fourth Quarter (Q4) of 2022. For its model 3 and model Y vehicles, it produced 419,088 and delivered 388,131, falling short of wall street expectations.
Tesla’s decline in sales of its Model 3 and Model Y vehicles, therefore, spurred it to reduce the prices, with the Model 3 price now pegged at CNY 229,900 ($33,415) down from CNY 265,900, while the Model Y price now pegged at CNY 259,9000 ($37,775), down from CNY 288,900.
Investors King understands that this is the second time in 3 months Tesla is slashing the price of its vehicles in China.
In October last year, Tesla disclosed that lower production overheads prompted it to cut up to 9% off the cost of its vehicles in China, adding that it was also faced with strong competition from companies like BYD, which sells well-regarded cars at lower prices and is the country’s No. 1 electric vehicle brand.
Tesla’s price slash was the company rethinking its China sales strategy as it plans to keep its vast Shangai plant running, as the country accounted for a quarter of its top-line vehicles in the first nine months of 2022.
It is interesting to note that the Tesla Marque model remains China’s most popular foreign brand for battery-powered cars, as China accounts for roughly 40 percent of Tesla’s sales
Meanwhile, the shares of Tesla have plunged by more than 45% over the last six months, as Elon Musk blamed Tesla’s declining share price on rising interest rates and other macroeconomic factors.
However, investors disagree with him as they disclose that his takeover of Twitter, coupled with his antics on the social media platform has forced the shares price to reduce drastically, as they feel his attention has been diverted to the detriment of Tesla’s growth.
