SHANGHAI (Reuters) – Tesla (NASDAQ:TSLA) is poised to report one of its best quarters in China, the latest retail sales data showed, after becoming the first electric vehicle maker in the country to cut prices in a bid to defend its market share.
The U.S. EV maker’s retail sales in China totaled 106,915 units from Jan. 1 to March 19, or 1,371 units per day on average, according to data from China Merchants Bank International, which tracks car insurance registrations.
That was slightly higher than the 1,327 units it sold daily on average in the fourth quarter in China, when Tesla sold a total of 122,038 cars, its best quarter so far, the data showed.
Tesla did not immediately respond to a request for comment.
Bulwarked by its higher profits per car than other electric vehicle makers, the U.S. automaker slashed prices of its best-selling models by up to 13.5% in China in January, triggering a price war with BYD and several rivals following suit over the next two months.
Tesla’s growth pace, however, is yet to catch up with BYD, which outsold Tesla by more than five times in the January-February period, with its wide range of offerings of electrified products in China.
The company is planning refreshed versions of Model 3 and Model Y in the next two years to tackle an ageing product mix that has hit its attractiveness to customers. It has also improved the suspension system in the Model Y made in China since January to make the ride smoother, an update Tesla fans lauded on social media.
The company had been focusing more on energy efficiency and practical features such as safety and storage space in its marketing in China to lure more pragmatic buyers.
Tesla’s sales in the first two months accounted for 7.9% in China’s fragmented sector of new energy cars including pure electric and plug-in hybrids, slightly up from 6.8% in the same period a year ago, according to Reuters calculations based on data from China Passenger Car Association.
Meanwhile, BYD extended its lead with a 41% market share, a big jump from 29% a year ago.