Tesla Inc (NASDAQ: TSLA) is making its vehicles more competitive in prices to gain a bigger share of the Chinese EV market, if the reports are true.
What happened: Tesla is planning to produce a third Shanghai Giga EV model in 2022, with an estimated price between 160,000 yuan ($ 24,700) and 200,000 yuan ($ 31,000), local Chinese media reported. The new car project started in September 2020 and product validation is scheduled to be completed in March, the report said.
Tesla currently sells Model 3 vehicles in China and has started taking orders for Model Y vehicles made in China.
Related link: Why Tesla opposes South Korea’s green energy vehicle policy proposal
The new sedan, according to the report, is likely to be a two-seater with a chassis similar to the Model 3.
Tesla GF3 will start producing the third model in 2022 earlier, #China media citing GF3 ecological assessment report.
The model that is supposed to be based on the Model 3 chassis will cost ¥ 160,000-200,000. pic.twitter.com/hfBggv5ct9– Moneyball (@DKurac) January 8, 2021
The cheapest Tesla car is the Model 3 made in China, which is armed with a lithium iron phosphate battery. It costs about 249,900 yuan ($ 38,500).
Because it’s important: With the agile Chinese EV startups, like Xpeng Inc – ADR (NYSE: XPEV) and Nio Inc – ADR (NYSE: NIO) taking a deep breath in Tesla’s neck, the competitive price is a way to make deeper inroads into the local market.
Nio currently sells to a high standard, while Xpeng serves the medium and small market. There is much speculation that Nio may also be looking to enter the low-cost market, although the company has not confirmed the same.
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