While Tesla made a significant drop in its prices a few days ago, it is now the turn of its Asian rival VinFast to consider an overhaul of its pricing policy. A strategy also adopted by two other Chinese brands, including Xpeng, which has brought down its prices.
Despite a sales record with more than one million cars delivered in 2022, Tesla had a rather difficult end to the year. Indeed, the brand has had great difficulty selling its vehicles in China and the United States, despite several price cuts and the return of the sponsorship program. A lack of love which can be explained by several reasons, including the recession in the Middle Kingdom and the desire of American customers to wait until 2023 to take the plunge, due toan advantageous change in taxation around electric cars.
A sharp drop
But while Tesla could live in 2023 the worst year of its existence, then heckled by Chinese manufacturers who arrive in force, the brand has decided to tackle the problem head-on. Thus, it carried out a major operation to lower its prices all over the world. The goal is to encourage customers to take the plunge, especially in Europe. Because in France, the amount of the ecological bonus was revised downwards on January 1, which led many buyers to place orders before the end of last year.
Finally, prices literally plummeted by more than 10,000 euros in the space of a single night on our market. A fall that concerns the whole world, making the Model 3 and Model Y more affordable than ever. A situation that has cause for concern for the rivals of the American brand, who were quick to react. This is particularly the case of Xpeng, which has just made a significant drop in its prices in China.
The P5 and P7 as well as the G3 SUV then fell from 20,000 to 36,000 yuan, or the equivalent of 2,700 to 4,900 euros according to the current exchange rate. We are far from the drop at Tesla, but it is still very impressive. A modification which should however annoy customers who have already placed an order at full price, but which is essential. Indeed, and as explained Electrekspecialists fear a wave of order cancellations among Chinese brands, in favor of models from Elon Musk’s firm.
But the Chinese firm, which is slowly arriving in Europe, is not the only one wanting to get in tune with its rival. Indeed, VinFast also plans to set up promotional operations for its customers. This is indeed what a spokesperson for the Vietnamese brand explains to the American agency. Reuters. The latter asserts that ” we are considering many promotional programs which we will announce soon“.
higher prices
However, the manufacturer has not yet specified whether these operations would include price reductions. This is very likely, however, as VinFast’s vehicles currently cost more than those sold by Tesla. For comparison, the VF8 is displayed from 59,000 dollars (about 54,413 euros), against 52,990 dollars (about 48,870 euros) for the Model Y in the United States.
In France, Tesla’s compact SUV starts from 46,990 euros in its Propulsion version against 62,200 euros for the VinFast VF8. Nevertheless, we are not immune to a new rise at Tesla, while we know that the brand tends to play yoyo with its prices. Especially since it has reviewed the terms of its contract with the company Piedmont Lithium Inc., responsible for providing it with the lithium necessary for the design of the batteries.
If the rates were previously blocked, they will now be reassessed according to the market. However, this tends to increase, while the price of this material has soared 1,200% in the last two years. An increase that will logically be reflected in the price of Tesla in the future. But the brand will not be the only one, since all manufacturers should be affected, while specialists fear a shortage of batteries in the future. In question, the strong demand for materials and their scarcity.
The solution ? Reduce the size of the accumulators, as recommended by Renault, to the detriment of autonomy. But this is the only possibility to consider while waiting for the development of the solid battery, which would allow a lasting fall in the prices of electric cars in the future.
Price change for Tesla in 2023, and with the new prices, one thing seems clear: the market will be flooded with Model 3 and Model Y. Let’s go back to the why and how…
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