FLORIDA (Reuters): Tesla Inc (TSLA.O) has slashed prices of its electric vehicles in the United States and Europe, doubling down on a discount drive it started in Asia as demand slows against the backdrop of a weakening economy.
In 2022, the Elon Musk-led company missed its target to grow deliveries by 50% annually as it struggled with supply chain constraints and a demand slowdown caused by growing recession fears. Still, Musk has said the carmaker could deliver 2 million vehicles in 2023 as price cuts boost demand.
China-made Tesla car sales rose 18% in January from a five-month low hit in December. February saw a 12.6% rise.
Following are details of the price cuts:
Tesla slashed prices for all versions of its Model 3 and Model Y cars in China by between 6.0% and 13.5% in January, according to Reuters calculations.
In February, however, the carmaker raised prices of the performance and long-range versions of its Model Y mid-size sport utility vehicles (SUV) in China.
In the second such price increase, starting prices of the two versions of Model Y in China increased by 2,000 yuan each to 311,900 yuan ($44,983.20) and 361,900 yuan.
The performance Model Y remains 9% cheaper than before the price cuts, while the long-range version is 13% cheaper.
Tesla cut the prices of its Model 3 and Model Y cars by about 10% each in the country – for the first time since 2021. The price for the Model 3 rear-wheel drive version is now 5.369 million yen ($39,501.18), down from 5.964 million yen.
Tesla’s price cuts in the country differed from model to model, but ranged from about 6 million won to 10 million won ($7,702.74), a local Tesla sales official said.
The price of Tesla’s basic Model 3 rear-wheel drive vehicle was listed as 64.34 million won ($50,637) on the company’s website on Friday. Its Model Y Long Range sports utility vehicle was 84.999 million won.
Tesla’s U.S. price cuts on its global top-sellers, the Model 3 sedan and Model Y crossover SUV, were between 6% and 20%, Reuters calculations showed.
It raised the price of the Model Y at least three times after that. Still, the Model Y is about 16% cheaper than it was in early January for U.S. customers.
The company further cut prices for its Model X luxury crossover SUV by 9% and Model S sedan by 4% in the United States.
Tesla cut prices on the Model 3 and the Model Y by about 1% to almost 17% depending on the configuration.
Customers buying the Model 3 for 44,990 euros ($47,860.36)will now get a further price reduction through a government subsidy of 5,000 euros. The upper limit for the EV scheme is 47,000 euros.