Tesla is cutting prices by about $2,000 in China, in line with US cuts

Written by Hyunjoo Jin and Ethan Wang

BEIJING (Reuters) – Tesla Inc has cut prices by nearly $2,000 across its models in China, following price cuts in the United States, as it struggles with falling sales and an intensifying price war for electric vehicles, especially against cheaper Chinese electric vehicles.

Elon Musk's electric car maker has cut the starting price of the revamped Model 3 in China by 14,000 yuan ($1,930) to 231,900 yuan ($32,000), its official website showed on Sunday.

Tesla has made similar cuts to the starting price of the Model Y, which now stands at 249,900 yuan, the regular version of the Model S to 684,900 yuan and the Model S Plaid to 814,900 yuan. The regular Model

On Friday, the automaker cut US prices for its Model Y, Model X and Model S vehicles by $2,000. On Saturday, it reduced the price of its fully autonomous driver assistance program to $8,000 from $12,000 in the United States.

Tesla reported this month that its first-quarter global vehicle deliveries fell for the first time in nearly four years, as price cuts failed to stimulate demand.

The electric car maker has been slow to update its older models, as high interest rates have sapped consumers' appetite for expensive goods, while rivals in China, the world's largest car market, are rolling out cheaper models.

Musk postponed a planned trip this weekend to India, where he was scheduled to meet Prime Minister Narendra Modi, due to his commitments at Tesla. Reuters reported on Saturday that the trip was scheduled to include the announcement of Tesla's plans to enter the South Asian market.

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Musk said last Monday that Tesla would lay off more than 10% of its global workforce, as the automaker braces for its first annual decline in deliveries.

The announcement came after Reuters reported on April 5 that Tesla had scrapped its plan to develop its long-awaited affordable electric car in favor of robotaxis. Musk posted that “Reuters is lying” after the report, without mentioning any inaccurate information. He did not talk more about the model, leaving investors demanding clarity.

Tesla shares are down 40.8% so far this year.

Since late 2022, Tesla has sparked a price war as Musk sought volume growth at the expense of margins.

($1 = 7.2403 Chinese yuan)

(Reporting by Ethan Wang, Bernard Orr and Hyunjoo Jin; Editing by Michael Perry and William Mallard)

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