Tesla cuts by a quarter the price of cars in China to increase sales

Best electric car maker, Tesla has cut prices of its models in China by almost a quarter, with the goal of boosting sales on the world's largest new energy vehicle market. The US manufacturer has announced a reduction of 12 to 26% in the price of its Model S sedan and its Model X SUV in China. The cheaper model 3 prices in China, which were also released earlier, are now 14% below pre-order prices.

"We are absorbing a significant portion of the fare to help make our cars more affordable for customers in China," the China Daily newspaper said in a Tesla statement.

China, where new energy vehicle sales rose 75.6% in the first 10 months of this year to 860,000 units, is one of Tesla's largest markets.
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Tesla sales in China totaled 2,147 units from August to October, a 56% year-on-year drop, according to statistics from the China Passenger Car Association. Last year, it sold 17,030 cars, representing 16.5% of its worldwide sales.
The automaker had raised the prices of its models by about 20 percent in July, after China imposed an additional 25 percent tariff on US cars in response to US duties on Chinese products.

The automaker's new initiative is seen as an attempt to counter any negative effects of the current trade war between the United States and China, the report said.

Tesla is the first foreign automaker to get permission to install a wholly owned plant in China as the country opens its automotive industry more widely to the world, reported the China Daily.

Last month, Tesla secured the site of the facility, which is expected to produce about 250,000 vehicles and battery packs a year, which will then increase to 500,000 units. The first cars are expected to come out of the production line in about three years, the report says.