Tesla, through its Chinese arm, has just launched a new set of customer incentives for its popular Model 3 and Y, as per the announcement on local social media platform Weibo on Friday.
Tesla Model 3/Y incentives
The leading American electric automaker presented a wide range of ways customers can benefit from lower prices when buying the Tesla Model 3 or Tesla Model Y produced in Gigafactory Shanghai.
First and foremost, Tesla offers up to ¥34,600 ($4,810) in benefits for buyers who take delivery before the end of March.
The incentives reportedly include an insurance subsidy of ¥8,000 ($1,111) for Tesla Model 3 and Model Y in rear-wheel-drive configurations.
In addition, it also offers up to ¥10,000 ($1,389) discounts on select body pain options for all Tesla Model 3 and Model Y variants.
Customers can further maximize their savings by availing of a low-interest financial policy exclusive to RWD versions. Tesla currently offers an annual interest rate of as low as 1.99%, enabling a maximum savings of about ¥16,600 ($2,340) for Tesla Model Y customers.
It must be noted that these offers are only applicable to already produced units, excluding models customized to buyer demand before production.
Competition
Despite Tesla’s significant price cuts and incentives on its electric vehicle offerings in China, the local market remains an extremely competitive space for the technology.
Numerous local companies, including BYD, have been striving to ultimately overthrow Tesla. In a significant development, BYD successfully beat Tesla in the fourth quarter of 2023. It has utilized its own pricing strategy and discount schemes to maintain its growth, potentially enabling it to repeat the same feat this year.
For instance, BYD cut the base prices of the Qin Plus Glory Edition and the Chaser 05 Glory Edition to ¥79,800 upon their launch, initiating a new price war in the world’s largest auto market. Comparatively, BYD originally priced the two new models at RMB 99,800 and RMB 101,800, respectively.
How does Tesla’s pricing strategy boost sales?
Earlier this year, Tesla also launched discounts for its electric vehicle offerings in China to boost its sales further.
Impressively, some of the discounts employed last month seem to have been effective. Per the insurance registration data, Tesla enjoyed a 31.7% sales growth in China from February 19 to 25 compared to the prior week.
In January, the American electric vehicle giant’s sales reached a total of 71,447, including the exports to other foreign markets.
All that said, Tesla’s move to offer new incentives to inventory Model 3 and Y units is a crucial part of its strategy to boost its sales before the end of the first quarter. Such strategies will undoubtedly enable the Musk-led company to defend its market dominance against Chinese rival BYD this year.
