Tesla (TSLA) raises the price of Model Y performance cars in China

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You’re here TSLA recently announced a price hike for its Model Y Performance car in China.

The electric vehicle (EV) maker increased the price of the Performance version of the Tesla Model Y made in China by 10,000 yuan ($ 1,550) or 2.6%, from 377,900 yuan to 387,900 yuan (60,192). $), due to higher manufacturing costs. . However, the prices of the other two versions, namely the cheaper Standard Range version (introduced in China in July) and the Long Range version, remain unchanged, starting at 276,000 yuan and 347,900 yuan respectively.

The Performance version should be available on the market from the fourth quarter of this year. Users who have already paid the deposit will only need to pay the original price and not the new one.

This is not the first time that Tesla has raised the prices of its Model Y in the Chinese market. On March 24, the prices of the high-performance version and the long-range version were both increased by 8,000 yuan.

Internationally, Tesla’s Model Y SUV is sold in two variants: Long Range and Performance. While the Long Range can carry up to seven people, the Performance variant has a five-seater layout. It is only in the Chinese market that Tesla offers the cheaper Standard Range version, which debuted in July of this year. While the standard version can travel 525 kilometers (326 miles) on a single charge, the long-range and performance versions promise 594 km (369 miles) and 566 km (352 miles), respectively.

At present, China is the largest electric vehicle market in the world and the country has been very strong in its transition to a green future. The country aims to have electric cars account for 25% of new car sales by 2025 and launch an era of green transport. In the midst of this transformational scenario, Chinese automakers are rapidly switching to electric.

China is said to be Tesla’s second largest market after the United States, accounting for around 30% of its revenue. Tesla currently manufactures Model 3 electric sedans and Model Y sport utility vehicles (SUVs) at its plant in Shanghai, China. Tesla regained its share of the Chinese market once it started selling domestically produced vehicles in China in late 2019, as these were 13% cheaper for Chinese consumers than vehicles imported from the United States. The electric vehicle giant also received strong support from Shanghai, when it built its first overseas factory there in 2019.

The Chinese market is the key to Tesla’s global growth ambitions. In fact, Tesla’s Model 3 sedan is one of the best-selling electric vehicles in the country. The company has a dominant market share on the continent with sales of 147,445 vehicles last year. The company’s flagship model in China, the Model Y, also got a green signal for sale in the country last December.

However, the situation appears to have changed recently for Tesla, which is under increasing regulatory scrutiny in China due to several accidents involving Tesla vehicles in recent months. In fact, the automaker has been called in by Chinese regulators over recalls, quality and safety concerns with its cars, including battery fires and abnormal acceleration. Earlier this year, Tesla cars were also banned from military compounds and Chinese housing complexes due to security concerns related to the collection of sensitive data by cameras installed in vehicles. The ban was spurred on by concerns that Tesla is collecting confidential data through cars’ built-in cameras, which cannot be controlled by the Chinese government.

Additionally, despite its strong footprint in China, California-based Tesla faces stiff competition from Chinese electric vehicle companies, such as the Shanghai-based electric startup. NIO inc. NIO. In addition, Chinese companies like XPeng Inc. XPEV and Li Auto LI, who both debuted on US stock exchanges last year, is also capitalizing on the trending electric vehicle hype.

Amid the string of negative publicity and recent backlash for Tesla in China, the peak in sales in China for August is the only bright spot for the automaker. According to the China Passenger Car Association (CPCA), the electric vehicle giant sold a total of 44,264 Chinese-made electric vehicles in August, including 31,379 units for export. The number of deliveries represents an increase of 275% year-on-year and a gain of 34% from July. In fact, the company’s local shipments of 12,885 units in China marked an increase of nearly 50% from July, when shipments fell 69%. Tesla’s August numbers are hugely impressive given that the company was battling a severe chip shortage in August. In fact, the chip shortage was so devastating in August that the Shanghai Gigafactory was forced to shut down operations for four days.

Meanwhile, before its debut in India, an unmanned Tesla Model Y electric SUV test mule was spotted on Indian roads. While fans were sure Tesla’s first product for India would be the Model 3, which has been spied on multiple times on Indian roads, the latest tests confirm that the Model Y will be India’s second offering.

Tesla currently has a Zacks rank of 3 (Hold). You can see The full list of today’s Zacks # 1 Rank (Fort Buy) stocks here.

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