Tesla’s decision caused an earthquake in the Chinese market, the existence of many car companies in danger
Tesla selling cars at 50% discount
Other companies lodged objection
Preparing for legal action on Tesla
New Delhi. A decision by Tesla, the world’s largest electric car maker, has created a stir in the Chinese car market. In fact, to accelerate the sluggish sales due to the Corona epidemic, the company is selling its cars at a huge discount. With this decision of Tesla, the condition of other companies making electric cars in China has started deteriorating.
Cars are being sold at 50% discount
In October last year, Tesla announced a 14% discount on its cars to boost sales quickly. Tesla is already selling its cars made in the Chinese factory at a lower price. According to a report, Tesla’s car model sold in China is sold at half the price of the same model sold in Europe. If seen, Tesla cars are 50% cheaper in China than in Europe and America.
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Because of this, Tesla cars sold in China are already being sold at a much lower price. In the case of electric cars, the competition in the Chinese market is more than before. While China is home to a host of electric car manufacturers, new startups have made the competition tougher.
Other companies are also giving discounts
Due to huge discounts on cars, now a large number of customers are getting attracted towards Tesla. In such a situation, other companies have also made huge cuts in the retail price of cars to compete with Tesla. Due to the low profit margin on cars, the situation of many companies has started deteriorating.
Along with China’s electric car startups Xpeng Inc. and Neo Inc., Mercedes-Benz and Ford Motor are also offering a discount of 70,000 yuan (about Rs 8.30 lakh) on their electric cars. According to a report, more than 30 car companies have cut prices.
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Legal action will be taken on Tesla
Other companies selling electric cars in China allege that Tesla is violating Fair Trade Practice terms. In such a situation, the companies have no other option but to take legal action against Tesla. Last week, China’s state media quoted local governments as saying that they would no longer offer subsidies on electric cars made in the country.
Let us tell you, after the Corona epidemic, China’s automobile sector is going through a recession. The spending power of Chinese consumers has come down due to the prolonged Covid restrictions. In such a situation, the removal of subsidy on electric cars has caused a double whammy on the companies.
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Tags: auto news, Bike News, China, Corona, electric vehicle, Tesla
FIRST PUBLISHED : March 27, 2023