Tesla Inc. reduced the price of its electric vehicles on Friday in Europe, Israel, and Singapore, continuing a global discounting campaign that started in China in January but raising questions about its top profit margin in the industry.
Despite offering discounts in the United States, China, Japan, Australia, and South Korea in an effort to increase demand, Tesla said last week that first-quarter deliveries were only up 4% from the previous quarter.
Days after revealing the unimpressive delivery figures, Tesla announced the price decrease of its fifth vehicle this year on the U.S. market as Washington gets ready to enact stricter regulations that will restrict EV tax credits.
Due to logistical challenges and declining demand, the most valuable automaker in the world failed to meet CEO Elon Musk’s delivery objective of 50% growth in 2022 and instead achieved a 40% rise.
Due to a scaling up and improvement in its production capacity, Tesla claimed on Friday that it had lowered pricing in many European countries, including Germany and France.
Tesla has reduced the cost of its Model 3 and Model Y vehicles in Germany by between 4.5% and 9.8%, according to information posted on its website on Friday. This is the company’s second price cut of the year after a 1-17% decrease in January.
According to its local website, Tesla reduced the cost of its Model 3 and Model Y vehicles in Singapore by 4.3% to 5%.
Following a preliminary wave of global price reductions in January, Tesla likewise reduced pricing in Israel, with the base rear-wheel drive Model 3’s price falling by 25%.
According to Musk, Tesla will concentrate on lowering prices to boost demand and that it has success igniting orders with January’s discounts.
Since the beginning of the year, Tesla has reduced the cost of its base Model 3 by a total of 11% in the United States, as well as its base Model Y by 20%.
Next Monday, Tesla releases its first-quarter financial results.
(Adapted from Investing.com)