Just a few months after its last price cut, Tesla is once again cutting the price of the Model 3 in China. The additional price cut is to qualify for the government’s new standards for electric car subsidies, the company said on Weibo. To qualify, the price of the car has to be under 300,000 yuan (US$42,450).
As of today, people in China can now buy the basic version of the Model 3 for 271,550 yuan (US$38,425) after rebates, a competitive price in China’s electric car market. The official starting price of the Model 3 fell from 323,800 yuan (US$45,820) to 291,800 yuan (US$41,290). After the January cut, buyers had been paying 299,050 yuan (US$42,315) after rebates. Anyone who recently bought a Model 3 is out of luck, though. Tesla China Vice President Grace Tao told Chinese media that the company won’t compensate existing car owners.
In an earnings call, CEO Elon Musk said that Tesla is “making rapid progress” on lowering production costs in China, so the vehicle will deliver “good” gross margin despite the price cut. Tesla aims to produce 4,000 vehicles per week at its Shanghai Gigafactory by mid-2020.