Tesla pro­motes lower priced China-made Model 3 in sales push

Daily Mirror (Sri Lanka) - - BUSINESS -

BEIJING/SHANG­HAI (Reuters) - U.S. elec­tric ve­hi­cle (EV) maker Tesla Inc said yes­ter­day it would price its Chi­na­made Model 3 ve­hi­cles from 328,000 yuan (US$47,529), 13 per­cent cheaper than those it cur­rently im­ports as it pushes sales in the fast grow­ing mar­ket.

The car­maker has been build­ing a fac­tory in China since Jan­uary where it its ini­tial out­put will be Model 3 cars. Pre-or­ders for the ve­hi­cles will also start on Fri­day, the com­pany said on its web­site.

The “stan­dard range plus Model 3” is 49,000 yuan cheaper than China’s cur­rent cheap­est ver­sion, also stan­dard range plus, even though it re­mains un­clear whether the car­maker will qual­ify for China’s sub­si­dies for new en­ergy ve­hi­cles.

The start­ing prices for five dif­fer­ent ver­sions of China-made Model 3s range from 328,000 to 522,000 yuan. Cus­tomers can ex­pect to re­ceive the car in 6-10 months, the com­pany said in a press re­lease.

It also said buy­ers will only need to put down a de­posit of 20,000 yuan and that fi­nanc­ing op­tions on of­fer meant that monthly pay­ment in­stal­ments will start from 1,100 yuan.

“The price drop is to make Tesla more ac­ces­si­ble,” it said.

The higher-end ver­sion of the Model 3 will still be im­ported from the United States.

In­vestors are fo­cused on whether the gross profit mar­gin on the Model 3 will re­main around 20 per­cent in China.

Doubts about the Model 3’s pro­duc­tion rate and sales per­for­mance have hit Tesla’s share price in re­cent months.

Pro­duc­ing cars lo­cally is likely to help Tesla min­i­mize the im­pact of Sino-u.s. tit­for-tat im­port tar­iffs, which has forced the EV maker to ad­just prices of its U.s.-made cars in China.

Keep­ing prices in check will also help Tesla fend off com­pe­ti­tion from a swathe of do­mes­tic EV star­tups such as Nio Inc, Welt­meis­ter and Xpeng Mo­tors, as well as es­tab­lished car­mak­ers in­clud­ing Volk­swa­gen AG and Gen­eral Mo­tors Co.

Tesla’s so-called Gi­gafac­tory is China’s first wholly for­eign-owned car plant and is seen as a re­flec­tion of the coun­try’s broader shift to open up its car mar­ket.

Pic­tures of the Shang­hai plant posted on Tesla’s so­cial-me­dia ac­count showed con­struc­tion of its main sec­tion was nearly done. The com­pany also held a re­cruit­ment event this week for car man­u­fac­tur­ing and lo­gis­tics work­ers.

Tesla fore­cast its de­liv­er­ies in 2019 would reach 360,000 to 400,000 ve­hi­cles and said it may pro­duce as many as 500,000 ve­hi­cles if its China fac­tory reaches vol­ume pro­duc­tion in the fourth quar­ter.

Newspapers in English

Newspapers from Sri Lanka

© PressReader. All rights reserved.