Tesla has lowered the China prices of its Model X and Model S, shifting more of the tariff burden onto itself as the trade dispute between the United States and China continues to hit imported cars.
The U.S. electric carmaker said the two models will cost 12% to 26% less in China, where demand for new-energy vehicles has been rising quickly. Tesla said in a statement sent to Reuters: “We are absorbing a significant part of the tariff to help make our cars more affordable for customers in China.”
The price cut reverses a July increase, when Tesla raised China prices on the Model X and Model S by about 20% after tariffs were lifted. In 2018, the company warned that the new duties were creating serious sales problems in China and would force it to speed up investment in its first overseas Gigafactory in Shanghai.
Tesla secured the site for that factory last month. The plant is expected to help the company avoid the steep import tariffs that currently affect all of the cars it sells in China.
The company also recently began pre-sales of its Model 3 in China. Tesla said the dual motor all-wheel drive version would start at 540,000 yuan ($77,928.83), while the performance version would cost 595,000 yuan.
Before the July increase, Tesla had lowered China prices in May after Beijing said it would cut import tariffs on all auto imports.
The exchange rate used in the report was $1 = 6.9294 Chinese yuan.
