Tesla cuts prices in China and US after slow sales, adding to excess inventory – Firstpost

Representative image. Reuters

Tesla Inc. has cut prices in its two main markets, China and the US, after disappointing first-quarter sales that contributed to excess inventories.

All Tesla prices in China have fallen. The updated Model 3 now costs just 231,900 yuan ($32,000) instead of 245,900. The Model Y was reduced from 263,900 yuan to 249,900 yuan, or about $34,500.

The starting price of the Model Y in the US has dropped to $42,990, which is the lowest ever for this SUV. In addition, Tesla dropped the price of the Model

Even by CEO Elon Musk’s standards, the Austin-based manufacturer had an extremely eventful week culminating in these layoffs. It all started when Musk informed the company’s more than 140,000 employees in the company memo that he was implementing workforce reductions of more than 10% worldwide. In addition, two senior managers left.

In its proxy statement on Wednesday, Tesla said it will put Musk’s $56 billion pay plan back to a vote among shareholders. The deal was declared illegal by a Delaware court in January.

In addition, the company on Friday recalled about 3,900 Cybertruck pickups to repair or replace accelerator pedals that tend to come off and accidentally accelerate the car, increasing the chance of a crash.

Then on Saturday, Musk said he had to fulfill “heavy obligations” at Tesla and canceled his planned visit to India this week, when he was due to meet Prime Minister Narendra Modi.

Tesla will announce its first quarter results on April 23. Due to concerns about declining sales, escalating competition in China and Musk’s reckless vow to go ‘balls to the wall’ when it comes to autonomy, the company’s shares are down more than 40% this year.

With deliveries of 386,810 cars in the first quarter, the automaker suffered its first year-on-year sales decline since the early stages of the epidemic, falling far short of experts’ forecasts.

Based on statistics from the Chinese Passenger Car Association, Bloomberg calculated that Tesla’s market share in China fell from 10.5% in the first three months of 2023 to about 6.7% in the fourth quarter of 2023.

Bloomberg announced late last month that the manufacturer recently cut production plans at its Shanghai factories. Although overall passenger car sales in China rose, deliveries from the Shanghai factory, which produces electric cars for China and exports to other regions of Asia, Europe and Canada, fell in the first two months compared to the same period last year.

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