Tesla has cut prices worldwide as demand for EVs drops

Tesla has cut prices in the U.S., China and Germany as the automaker’s sales slow and competition in the EV market becomes increasingly fierce.

In the US, the company on Friday cut the prices of three of its five models by $2,000. The new prices are:

• The new Model Y costs $42,990
• A Model S is $72,990
• Model X $77,990

Prices for the Model 3 and Cybertruck remain unchanged at $38,990 and $81,895, respectively.

Tesla did not immediately respond to a request for comment Monday, but CEO Elon Musk addressed the price changes on social media Sunday.

“Tesla will have to change prices frequently to match production with demand,” he said https://twitter.com/elonmusk/status/1782067256194633756 X (formerly Twitter).

The price drop in China (the Model 3 is now about $1,930 lower) is particularly notable given that Tesla faces stiff competition from more than a dozen electric car rivals there, including Li Auto, NIO and BYD.

BYD has cut prices this year, sometimes by as much as 20%, to stay competitive in China’s electric car market, according to a recent Reuters report. Report.Earlier this year, Forbes reported that BYD had overtaken Tesla to become the world’s largest electric car seller. report.

Tesla also faces growing competition in the U.S. as automakers seek to win over customers with new electric vehicles. Ford, General Motors and others have invested billions of dollars. Produce vehicles with low retail prices than Tesla cars. Between 2018 and 2020, Tesla will account for 80% of US electric car sales, but by 2023 that number will drop to 55%. According to Cox Automotive Company.

“Tesla is still the market leader (in electric car sales), but there are better options now,” said John Vincent, senior editor for vehicle testing at US News & World Report. told CBS Financial Watch.

In Germany, the Model 3 price drops from $43,670 to $42,990.

This isn’t the first time Tesla has cut prices

last year, Tesla has cut prices Some models cost up to $20,000. In March, the company’s best-selling Model Y received a temporary price cut of $1,000. Deductions cut into company profit margins, spooking investors.

Tesla shares fell more than 3% to $142.20 a share Monday afternoon. The stock is down more than 40% since the start of the year.

Tesla’s prices have been slashed as the Texas-based company faces recalls, layoffs and declining sales.

Tesla About 4,000 Cybertrucks have been recalled this month That’s because they have a faulty accelerator pedal that can shift when a lot of force is applied, according to the National Highway Traffic Safety Administration (NHTSA). NHTSA said the pedals could get stuck in the interior trim above them, which could increase the risk of a crash.

Tesla too Plan to lay off more than 10% of employees Musk confirmed in a regulatory filing that the company has about 140,000 employees. As a result, Tesla could cut about 14,000 jobs by the end of the year.

Organization Explained This month, the company delivered 386,810 vehicles from January to March, which is about 9% less than the 423,000 delivered during the same period last year. Tesla attributed some of the sales decline to the gradual rollout of updated Model 3 sedans at its Fremont, California, factory.

The company said factory shutdowns due to shipping diversions in the Red Sea and an arson attack that knocked out power at its German factory also contributed to the lower deliveries. It’s unclear what the lower deliveries will mean for Tesla’s bottom line. Tesla will report first-quarter earnings on Tuesday.

Wedbush Securities analyst Dan Ives said last week that the next few months will be a critical time for Tesla as investors focus on whether Musk can turn the business around in 2025.

“For Musk, this is a thorn in the side to get Tesla through these turbulent times, or dark days may lie ahead,” Ives said in an analyst note.