Elon Musk’s Tesla will increase the price of its Model Y in both the U.S. and Europe, a slight uptick that comes even as it wages a price war against its Chinese rival BYD and other EV competitors in that market.
Tesla said Friday on Musk’s social media site X that the price for “all Model Y trims” would increase by $1,000 starting April 1. Reuters reports that Model Y prices in some European markets will also increase by about 2,000 euros on March 22, or about $2,200.
Musk has been trying to drive up sales in China, the world’s largest auto market, by cutting prices and offering new incentives in the price war against rivals like BYD, which is backed by Warren Buffett.
But the demand for electric vehicles has continued to decline in 2024, even as automakers aggressively slash prices and offer incentives to convince consumers. Tesla — known for selling the most popular EV on the market, by some metrics — is facing renewed skepticism from analysts and investors. Morgan Stanley analyst Adam Jonas, for example, openly wondered in a note to clients earlier this month, “Could Tesla lose money (sometime) this year?” Jonah cut his price target for Tesla to $320 from $345, pointing out several concerns with the EV market.
And BYD announced its latest ultra-cheap car on Wednesday. The Shenzhen-based company said the updated version of its e2 EV hatchback will be priced at 89,800 yuan ($12,485), 12.6% less than the previous price of 102,800 yuan ($14,303). It’s just the latest new model unveiled by BYD over the past month as the automaker looks to retain its dominance in China’s EV market and maintain its aggressive stance against Tesla.
Tesla stock has had a brutal start to 2024, losing more than 34% of its value so far this year in a slump that has also threatened Musk’s status as the richest person in the world.
-William Gavin contributed to this article.