Tesla has slashed prices in key markets like the US, China, and Germany due to dwindling sales, sparking an electric vehicle price war. Chinese competitors have been aggressive in the market, prompting Tesla to reduce prices of its Model 3 in China by 14,000 yuan and other models in the US by $2,000. Reuters reported additional price cuts in Europe, the Middle East, and Africa.
The company’s upcoming financial results for the first quarter of 2024 will be closely monitored. Tesla initiated the EV price war over a year ago by sacrificing profit margins for lower prices. While the company has been slow to update its models, Chinese rivals like BYD and Nio have been introducing more affordable options. Even smartphone maker Xiaomi entered the EV market recently.
Despite these challenges, Tesla’s CEO Elon Musk postponed a trip to India to fulfill “very heavy Tesla obligations.” The company also issued a recall for its Cybertrucks over safety concerns related to accelerator pedals getting trapped by interior trim. This, coupled with a decline of over 40% in Tesla’s shares since the beginning of the year, paints a challenging picture for the electric car giant. BBC News has reached out to Tesla for further comment.
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