Tesla temporarily slashes prices for some Model Y cars in the US
Tesla Inc has temporarily reduced prices on select Model Y vehicles in the U.S. through February 29.
This follows a price drop for the Model Y in Germany.
The price cuts include a $1,000 reduction for the Model Y rear-wheel drive, now at $42,990, and the Model Y Long Range, now $47,990. Meanwhile, the Performance variant and other models remain at their original prices.
For purchases completed by February 29, the discounted rates apply, with Tesla announcing an increase of at least $1,000 starting March 1. The earlier price cut in Germany reflected production disruptions at Tesla's Berlin factory caused by component shortages due to shipping issues in the Red Sea.
Tesla has cautioned that sales growth could be substantially lower this year as they shift focus to the production of a new electric vehicle codenamed "Redwood."
This strategic move and recent discounts may impact Tesla's profit margins amid ongoing price competition. The brand faces a tougher market with increased challenges from cheaper EV alternatives, such as those from China's BYD, which recently surpassed Tesla in global EV sales.
Additionally, Hertz Global Holdings has indicated a slowdown in EV demand by opting to sell nearly 20,000 electric cars, including Tesla models, in favor of gasoline vehicles. This decision was influenced by higher costs associated with EV collision and damage repairs.
Tesla's stock has declined by 22.1% this year, reflecting these wider market trends and challenges.