The price war triggered by Tesla at the beginning of the year in China is once again topical. Because again in the Asian country, some producers of electric vehicles with local headquarters, including Tesla but also Volkswagen and the JV it shares with SAIC, have decided to further reduce the price lists of their battery-powered cars starting this month.
Tesla cuts
Focusing on Tesla, the manufacturer led by Elon Musk has announced that it will offer a subsidy of 8,000 yuan, corresponding to 1,100 dollars for the Model 3 until September 30, and at the same time will also decrease the price of the long-range version of the Model Y to 299,900 yuan from 313,900 yuan; in addition, the price list of the high-performance version of the same Model Y will be reduced to 349,900 yuan from 363,900 yuan.
The reasons
But what drives Tesla in the first place but also all the other car manufacturers located in China to reduce the prices of their electric models? Basically there are two causes: on the one hand one competition that the Chinese market for electric vehicles is becoming increasingly fierce and therefore forces companies to increase their competitiveness by offering the same quality at lower costs; on the other, the reduction of raw material costs, which allows companies working in the automotive field to decrease production costs.
Lithium down
The question of raw materials is interesting. As reported by Argus Media, in fact, the prices of those used for the construction of electric vehicle batteries, in particular lithium, were on a downward trajectory during most of this year thanks to an easing of supply shortages, more sustained especially after the launch of a new production capacity. If we think about the lithiumfor example, its price is proving to be down nearly half since the start of this year and 57% from late November, when prices hit a record high.
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