NEW YORK: Tesla has cut prices in a number of its major markets, including China and Germany, following price cuts in the United States, as it grapples with falling sales and an intensifying price war, especially against Chinese electric vehicles (EVs).

The company slashed retail prices by up to $2,000, on vehicles such as the Model 3 and Model Y. These will take effect in several markets which includes the US, China and Germany, later this week. This will be Tesla’s most recent strategy to boost demand that had decreased due to high interest rates. The cuts come ahead of its quarterly earnings this Tuesday (today). The world’s most valuable automotive producer is expected to post its first revenue drop and lowest gross margin, in nearly four years, according to LSEG data. Tesla has been grappling with declining sales and an intensifying price war, especially against electric vehicles (EVs) produced in China.

Tesla stocks tumbled by 4 per cent on Monday, as its latest global price cuts fanned Wall Street concerns with regards to dwindling margins, for the electric-vehicle maker. This comes in the run-up to its earnings report, later this week.

Investors are anticipating much needed clarity from CEO, Elon Musk, on Tesla’s strategy. Musk had cut the company’s staff by 10pc in the week that passed. He said focusing on autonomous driving was a “blindingly obvious” move.

Earlier this month, Tesla’s CEO had announced an event scheduled for August, to unveil its “Robotaxi”

Published in Dawn, April 23nd, 2024