Apr 22 2024: Tesla (NASDAQ:TSLA) has expanded its price reduction strategy to include key markets like China and Germany, following a recent $4,000 reduction in the cost of its Full Self-Driving (FSD) software. These adjustments come in the midst of challenges such as declining sales and heightened competition in the electric vehicle (EV) sector.
In China, Tesla has slashed the price of the updated Model 3 by 14,000 yuan ($1,930), bringing it down to 231,900 yuan ($32,000) as displayed on its official website. Similarly, in Germany, the price of the Model 3 rear-wheel-drive variant has been lowered to 40,990 euros ($43,670.75) from its previous price of 42,990 euros.
These price reductions have also been rolled out in other regions, including Europe, the Middle East, and Africa, as confirmed by a Tesla spokesperson.
This move follows Tesla’s recent price cuts in the United States, where the Model Y, Model X, and Model S saw a $2,000 reduction in their prices last Friday. Additionally, the company lowered the cost of its FSD software from $12,000 to $8,000 on Saturday.
Tesla has been actively engaged in an EV pricing competition for over a year, initiating aggressive price cuts that have impacted its profit margins. However, the company has faced challenges in updating its older models promptly, partly due to high interest rates affecting consumer spending on high-ticket items. Concurrently, competitors in China, the largest global auto market, are introducing more competitively priced EV models.
Earlier this month, Tesla announced plans to reduce its global workforce by over 10%, as it anticipates its first annual decline in deliveries.
