Interesting reports are coming from China after Tesla applied a significant price reduction to the Made-in-China (MIC) Model 3 and Model Y electric cars.
According to Reuters, many customers that purchased MIC Tesla cars at the end of 2022, were negatively surprised by the recent price cuts by 5.7 to 13.5 percent, depending on the model, compared to late October prices.
Some customers appear to be shocked and even angry that they missed the price cuts, the report says.
To be fully clear, we must add that those customers purchased Tesla cars after the previous price reduction in October, often with additional incentives introduced by Tesla, to boost its end of the year sales (sales were down in December anyway). They were also in a hurry to get the 11,088 CNY ($1,635) subsidy (ending on December 31, 2022).
Once the customers saw that they could get an even better deal, sometimes by more than 10 percent, simply by waiting a few days or weeks, some likely became disappointed.
According to Reuters, hundreds of Tesla owners gathered at the Tesla's showrooms and distribution centers in China over the weekend, "demanding rebates and credit." We don't know the details and there is no official confirmation, but about 200 people were protesting at a Tesla delivery center in Shanghai, the article says.
The scale of the consumer backlash is not known, but at least several large cities were mentioned in the reports, including Beijing, Shenzhen, Chengdu and Xi'an.
""Chinese state media have largely opted not to cover the protests, which online videos showed happened in cities including Beijing, Shenzhen, Chengdu and Xi'an. Reuters witnessed a protest at a Tesla facility in Shanghai.""
Meanwhile, reduced prices mean also that Tesla Model 3 and Model Y in China are more affordable and attractive than ever.
This triggered a new wave of buyers, which appears to be big enough to already make a difference. The company's website now indicates a slightly longer delivery time of the two Model Y versions (RWD and Long Range AWD) - 2-5 weeks instead of 1-4 weeks previously.
The estimated delivery time for new orders of the two Model 3 versions, and the top of the line Tesla Model Y Performance remains the same: 1-4 weeks.
We saw also some unofficial reports about a very high number of orders placed after the price reduction, but there is no way to verify the numbers. The ultimate confirmation of the increased demand will be Tesla sales results in the first quarter of 2023.
The price reduction by Tesla is expected to affect the general electric car market in China. According the Chinese media, some companies might be more affected than others and as an example, XPeng was mentioned.
According to Zhang Xiang, a researcher at the Jiangxi New Energy Technology Institute (via CnEVPost after The Paper). The competition in the BEV price range of 200,000-300,000 CNY ($29,500-$44,300) might be fierce right now.
Troy Teslike noted that price-wise, the entry-level Tesla Model 3 RWD is now basically on par with the BYD Seal RWD. The two also have similar range and both are powered by LFP batteries.
Sources: Reuters, Automotive News, CnEVPost, CnEVPost (XPeng)