Tesla Slashes Prices in China for the Second Time in 3 Months to Boost Sagging Sales

The electric vehicle maker is dropping the price of two of its most popular models in China.

learn more about Madeline Garfinkle

By Madeline Garfinkle

Lillian Suwanrumpha | Getty Images
Tesla Model 3

Electric automaker Tesla has reduced prices in China for the second time in less than three months.

The company first slashed prices in China in late October 2022 — dropping prices of Model 3s and Model Ys by about 9.4%, CNN reported. Now, the price cuts are even deeper as Tesla struggles to maintain sales in China amid shrinking demand. The starting price for the Tesla Model 3 has been reduced by a further 13.5% to 229,900 yuan ($33,515), and the starting price for the Model Y has dropped by another 10% to 259,900 yuan ($37,889), according to CNN calculations.

According to Reuters, between the discounts and incentives Tesla is offering to Chinese buyers, prices are down between 13% and 24% overall since September.

Related: Elon Musk Is the First Person to Lose $200 Billion

Following the news of the price cuts, Tesla stock fell by 7%, marking its worst day on Wall Street since August 2020. This time last year, Tesla stock was trading at around $342. As of Friday morning, it's down to $107.

Although Tesla was once the leader in the electric vehicle market, demand for its cars has waned as other automakers have entered the space with more affordable models.

Related: 'Do Yourself A Favor and Get A Polestar': Tesla Owner Says He Was Trapped in a Tesla Model Y

The price cuts came after the company reported a weak production-to-delivery ratio for Q4 of 2022, producing 34,000 more vehicles than it delivered, per Yahoo Finance. With excess inventory and shrinking demand, it's possible Tesla prices might decline even further.

Madeline Garfinkle

Entrepreneur Staff

Editorial Assistant

Madeline Garfinkle is an Editorial Assistant at Entrepreneur.com. She is a graduate from Syracuse University, and received an MFA from Columbia University. 

Related Topics

Editor's Pick

Have More Responsibilities at Work, But No Pay Bump? Use This Script to Get the Raise You Deserve.
Black and Asian Founders Face Opposition at All Levels — Here's Why That Has to Change
Thought Leaders

5 Small Daily Habits Self-Made Millionaires Use to Grow Their Wealth

We've all seen what self-made millionaires look like on TV, but it's a lot more subtle than that. Brian Tracy researched what small daily habits these successful entrepreneurs adopted on their journey from rags to riches.

Leadership

Two Stanford Professors Explain How to Produce Hundreds of World-Changing Ideas In 1 Hour

Cramming everyone into a conference room to "spitball" is a disaster. But with some structure and a system, literally thousands of ideas are within reach.