Tesla Announces Price Drop In China, Entry-Level EV Now 6% Cheaper

EV giant Tesla Inc TSLA has cut the prices on its cheapest vehicle in China by as much as 6% while also cutting prices on its best-selling SUV.

What Happened: According to the Tesla website, the Model 3 rear-wheel drive is now priced at 15,500 yuan (about $2,183) lower at 245,900 yuan while its long-range version is priced at 285,900 yuan.

The company also cut prices on select versions of its Model Y SUV by as much as 2.8%. While the rear-wheel drive version is now priced at 7,500 yuan (about $1,056) lower at 258,900 yuan, the long-range version is priced at 299,900 yuan.

The price of the Performance edition of the Model Y, however, remains unchanged at 363,900 yuan.

Why It Matters: The price cut comes as Tesla faces increased competition in the Chinese EV market, particularly from Warren Buffett-backed BYD Co Ltd BYDDY BYDDF.
In the last quarter, BYD trumped Tesla as the world's largest EV maker, selling more pure electric vehicles than Tesla.

However, unlike Tesla which solely makes battery electric vehicles, BYD also makes hybrids.

Photo by Koshiro K on Shutterstock.

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