EV Makers Are Under Pressure By Reduced Tesla Model 3 Prices

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by Kivi

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10.06.2020



According to the Chinese media, a major topic among the New Energy Vehicle manufacturers is the lowered prices of the Tesla Model 3.

We already saw reports that the demand for MIC Model 3 is booming. It’s great on one hand, but as always – if competitors will not adjust to the new situation, their results might be affected.

It’s probably not a comfortable situation for Xpeng, NIO, BYD and others to see that Model 3 prices start at a comparable level to their EVs. Especially if this pricing is profitable for Tesla, and challenging for others.

 

It seems that Elon Musk’s plan to make manufacturing the major priority for the company pays off, as in the long-term, Tesla will be able to undercut others.

At this point, it’s difficult to evaluate the effect of LFP batteries in the new Model 3 SR+ version, as the Long Range version also got an even deeper price cut (10% vs 8%).

 

The biggest price pressure seems to be on the Xpeng P7, introduced just a few months ago, in June. Time will tell how well NIO will cope, but at least under current policy, the ability for battery-swap allows NIO to get subsidies despite prices above the limit.

BYD, also listed on the chart, has a lot of orders for the all-new BYD Han, and is busy introducing its BYD Blade Battery (LFP-CTP) in additional models, so it should be able to also lower the prices a bit.

Without a doubt, the times are very challenging and it will be even more difficult to compete when more models will hit the market, including the high-volume MIC Tesla Model Y in 2021 and Volkswagen ID.4 (produced in two plants in China).

 



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