Tesla Model Y price cuts have recently been announced by Tesla Inc. in Germany, where it ranks below Volkswagen as the most popular EV maker in 2023, following China price cuts. The announcement was made shortly after Tesla declared it would temporarily suspend most of its car production at its factory near Berlin due to the Red Sea conflict.

The price reduction was between 4.2% and 9.1%. The Model Y Standard Range+, Tesla’s entry-level offering is now available at €42,900 ($46,596.74), saving its new owners €1,900 ($2,063.68). They are also taking prices for their Model Y Long Range and Model Y Performance models down by €5,000 ($5,430.72), now retailing at €49,990 ($54,296.39) and €55,990 ($60,813.26) respectively.

Before the market opened, Tesla Inc’s shares experienced a drop of over 2% due to the company’s decision to lower Model Y prices across Europe. These recent price reductions have had an impact on other auto stocks as well. Following Tesla’s announcement of price reductions for the Model Y, there was a noticeable downturn in both European and Chinese automobile shares. Tesla’s bold pricing strategy appears to be causing disruptions across the global auto industry.

The price cuts could significantly boost Tesla’s electric car sales in Germany, the largest auto market in Europe. As the Model Y becomes more affordable, it could entice a wider range of consumers to make the switch to electric cars. Given the German market’s reputation for placing great emphasis on environmental concerns such as climate change, reducing air pollution, and traffic congestion, Tesla is likely to see substantial market demand for their electric vehicle options.

These significant price adjustments come amidst stiff competition in the German market, particularly from Volkswagen – a top electric vehicle seller in the region. According to registration data from Germany’s Motor Transport Authority, Volkswagen sold more new electric vehicles in the German market than Tesla, marking a major milestone for the automotive giant. The company managed to secure a 13.5% market share compared to Tesla’s 12.1%.

The EV war is heating up, with Tesla’s discounts seemingly aimed at gaining an edge over competitors like Volkswagen and BYD.

Image Source: NBC News