US carmaker Tesla says it will significantly lower the prices of its electric cars in Europe and the United States. The move comes as sales figures fall below the company's expectations.
More and more electric cars are entering the market, making competition fiercer. The price can go down by as much as 20%, depending on the model and market.
For example, the most expensive models on the home market have seen prices drop as much as $21,000. The cheapest version of the Model Y will be 20% cheaper on the U.S. market. The basic version there will then cost $52,990, which drops even further because purchasers of electric cars in the US are eligible for a tax credit of up to $7,500.
Prices have also been reduced on major European markets, including Germany, the United Kingdom and France. In the Netherlands, Belgium, Austria and Switzerland, Tesla cars are also becoming cheaper. For example, in Belgium, the price of the entry-level Model 3 is now €44,900 on the car brand’s website. For a Model Y, it is €46,990.
German prices drop by up to 17%
In Germany, the price of the entry-level version drops by $9,100 (almost 17%) to €44,890. For an entry-level Model 3, the price drops some €6,000 to €43,990, down about 12%.
Recently, Tesla had already lowered prices in China. There, the price of these two models dropped by 10%. It was the second drop there, after a first cut last October.
Tesla faces increasing competition in China from Chinese manufacturers such as BYD, Xpeng and Nio.
The price cuts may make Tesla models more affordable to more consumers. However, they are detrimental to those who have recently purchased a Tesla, as the used value of their vehicles is now lower. Earlier this month, hundreds of Chinese Tesla drivers massed in front of the carmaker’s showrooms and distribution centers out of dissatisfaction with the price cuts.
