Published on January 15th, 2024 | by Sounder Rajen0
Tesla Slashes Model 3 And Model Y Prices In China Again, What Is Happening?
This is the second time in mere months that Tesla slashed prices on these cars
Okay, so the Price wars in China have finally reached a point where I no longer understand anything that is going on anymore. Well, this whole thing has always been a bit hard to understand to begin with but now Tesla has slashed prices of two models for the second time in just months. What kind of repercussions will stem from this?
So not too long ago, we reported that Tesla would be reducing the prices of new China Model 3 and Model Y cars here. Now these same two models are seeing their prices drop to 245,900 yuan for the Model 3, and the price of the Model Y dropped to 258,900 yuan, as of 12 January 2024, according to the company’s website.
Moreover, Tesla’s refreshed long-range China Model Y has dropped its price to 299,900 yuan. What is happening? Nothing about these price wars is making sense anymore because what is Tesla hoping to achieve with this? The brand starting this price war already put some automakers out of business so what else does it want?
These price slashes are really concerning because it means that the company is not making a profit from its sales and that too, in the largest car market in the world. Clearly, this means the brand will need to make back those same profits elsewhere. Where exactly? Well, that gets a bit scarier to think about.
Well, here in Malaysia, the price of the Tesla Model Y and Model 3 are pretty good considering these are “luxury” electric vehicles (EVs). I use that word very sparingly here because I only consider the brand a premium or luxury brand on paper considering the countless problems that come with these cars.
On top of that, in the U.S, Tesla EVs are one of the most popular ones and that market actually has the full list of models to boast including the Model S, Model X and Roadster, which we do not get, officially at least, in Malaysia. Sadly, subscriptions are one way the brand makes back lost money from the U.S buyers.
So how long can Tesla keep up the price wars and will subscription services in the U.S be able to make up for lost profits forever? Well, let’s wait and see. Will Elon Musk prove us wrong with some long term strategy or is this all hubris?