Tesla Inc has reduced the prices of its Model X and Model S vehicles in China, shifting part of the tariff burden onto itself as the trade dispute between Beijing and Washington continues to squeeze imported cars.
The US electric vehicle maker said the two models would be cheaper by 12-26 percent in the Chinese market. The company said the move was meant to make the cars more affordable in the country, where demand for new-energy vehicles has been rising quickly.
In a statement sent to Reuters, Tesla said:
“We are absorbing a significant part of the tariff to help make our cars more affordable for customers in China,”
The price cut comes after a period of sharp swings in Tesla’s China strategy. In July, the company was among the first US carmakers to raise prices in response to tariffs, increasing Model X and Model S prices by about 20 percent.
Tesla had also warned last month that new tariffs were creating serious difficulties for sales in China and would force it to speed up investment in its first overseas Gigafactory in Shanghai. The company later secured the site for the facility, which is expected to help it avoid steep import duties.
The automaker, led by billionaire CEO Elon Musk, has also begun pre-sales of its Model 3 in China. Tesla said the dual motor all-wheel drive version would start at 540,000 yuan (USD77,928.83), while the performance version would cost 595,000 yuan.
Before the July increase, Tesla had lowered prices in China in May after Beijing announced cuts to import tariffs on all auto imports.
