The following Markdown English text is the professional translation of the Chinese text while maintaining the HTML tags inside the Markdown. Only the corrected and improved parts will be outputted without any explanations.
This article is authorized for reprinting by Chuxingyike (WeChat public account ID: carcaijing), created by the transportation industry group of Caijing Magazine, author: Li Yang, editor: Shi Zhiliang.
The Chinese love Tesla undoubtedly with a sudden burst of orders as soon as there is a price reduction.
Tesla’s price reduction is not news anymore, but a decrease of 70,000 yuan still received high attention from consumers.
Recently, Tesla released the domestic Model Y standard range version, with an actual selling price of RMB 276,000 after purchase tax reduction and subsidies, and it is expected to start delivery in August. Different from the long-range version, the standard-range version uses lithium iron phosphate batteries, and the national standard operating range is up to 525 kilometers.
The substantial price reduction of Tesla Model Y will not only have a huge impact on the 200,000-yuan-level smart electric SUV market but even affect other star models of Tesla.
Tesla Shows Its “Price Slayer” Once Again
Tesla’s sudden price reduction has directly caused Tesla’s official website to “burst orders” since the selling price of 276,000 yuan is much lower than the expected price in the market, respectively, 70,000 yuan from the long-range version and 100,000 yuan from the high-performance version.
A Tesla salesperson told Chuxingyike (ID:carcaijing), “Now, submitting a deposit of RMB 1,000 can lock up the production capacity, hesitation makes car delivery more difficult, and only the order volume in the first three days is enough to delay the delivery to the end of this year.” It was reported that on the first day of the domestic Model Y standard range version, orders surpassed 10,000, and on the second day, it exceeded 5,000. The orders of two days have exceeded the total sales of Model Y in June.
Tesla has been in negative public opinion since this year, such as not making the “315” news search hot list, female car owners claiming their rights at the Shanghai Auto Show, and several cities prohibiting Tesla drivers from parking, etc. Everyone aimed to attack Tesla. In April 2021, Tesla Model 3’s sales volume plummeted by 75% month-on-month, with only 6,264 units sold.
However, even so, Tesla remains the king of the automobile consumer market. The historical evidence repeated again and again that prices have a significant impact on Tesla’s terminal sales volume.
## Markdown English Translation
Using the Model 3 as an example, in October 2020, the subsidized price of Tesla’s domestically-produced Model 3 Standard Range Plus was reduced from ¥271,550 to ¥249,900, a decrease of up to ¥21,650. At the same time, the Standard Range Plus increased its range from 445 km to 468 km.
This price cut directly boosted Tesla’s sales, with the Model 3 achieving a significant increase in sales in November and December 2020, selling 21,604 and 23,804 units respectively.
It is worth noting that the Model Y’s price cut and the large-scale price cut of the 2020 Model 3 have a common feature, which is the use of lithium iron phosphate batteries produced by Ningde Times.
It can be seen that lithium iron phosphate batteries have an immediate effect on cost control and will continue to bring down the prices of Tesla’s vehicles as Ningde Times’ share in Tesla’s battery supply chain continues to increase in the future.
According to Dongwu Securities’ research data, Ningde Times supplied 30,000 electric vehicles to Tesla in 2020, accounting for a 20% share of China’s domestically-produced Tesla and 6% of the world market share. From January to May 2021, Ningde Times supplied 57,000 EVs to Tesla, accounting for approximately 47% of Tesla’s China market share and about 20% of the global market share. Dongwu Securities predicts that Ningde Times’ share in Tesla’s battery supply chain will stabilize between 40% to 50% in the future.
Who is affected by the budget version of the Model Y?
Undoubtedly, the impact of the budget version of Tesla’s Model Y, which has dropped from the ¥300,000 price range to the ¥200,000 price range, on the intelligent electric vehicle market is huge. This is because, whether it is joint venture or domestically-produced vehicles, this is almost the price of most flagship models. Such as the Ford Mustang Mach-E, which claims to have exceeded 45,000 orders, the Volkswagen ID.4, which has swept the European market, and the Giga Kraken 001, which has been delayed in delivery, etc.
Although Tesla has been embroiled in public opinion storms due to after-sales service and product quality issues, Tesla is still recognized as having the best intelligent driving experience among vehicles currently on the market. As Roland Berger’s global senior partner and vice-president of Greater China, Zheng Yun said to Chuxingyike (ID:carcaijing), “Tesla still holds an absolute leading position in the intelligent cockpit and autonomous driving areas.”
Correspondingly, Tesla’s sales have always been far ahead of the intelligent electric vehicle field, and from the perspective of market acceptance, Tesla has not yet encountered a truly threatening competitor.
This also means that to a certain extent, the most affected by the launch of the domestically-produced Tesla Model Y Standard Range Plus may not be the Model Y’s competitor vehicles, but Tesla itself.
| Author | Li Yang | |
|---|---|---|
| From | [Tesla 车主会] | |
| Date | 2021年7月17日 | |
| Link | https://teslacn.io/articles/6894 |
From the price point of view, the Model Y Standard Range version is only about 25,000 RMB more expensive than the Model 3 Standard Range version. However, in the Chinese market, SUV models are often more competitive than cars of the same level, in terms of both range and space. The experience of the Model Y Standard Range version is superior to that of the Model 3 Standard Range version.
Compared with the Model Y Long Range version, the advantages of the Model Y Standard Range version are also very obvious. With a price difference of about 70,000 RMB, it is enough to make up for many of its performance shortcomings, especially since there is not much difference in terms of specifications between the two versions. The range is only reduced by a negligible 70 km, and the acceleration from 0 to 100 km/h is only 0.6 seconds slower.
Among Tesla’s many models on sale, the Model Y Standard Range version is undoubtedly the most cost-effective one. Since the launch of the domestically-produced Model Y earlier this year, it has had a significant diversion effect on the domestically-produced Model 3. Now the even more attractive Model Y Standard Range version has entered the market, which will only further accentuate this effect.
It can be foreseen that with the intensification of Tesla’s “internal struggle”, the situation of one model dominating the market will be broken. However, the richness of Tesla’s product matrix also makes the Tesla brand more competitive in the market.
This article is a translation by ChatGPT of a Chinese report from 42HOW. If you have any questions about it, please email bd@42how.com.