Tesla has cut prices across several of its major markets — including China, Germany, and the U.S. — to combat slowing demand for electric vehicles ahead of a major earnings report.
Earlier this month, Tesla reported its first quarterly year-over-year sales decline since 2020. The Austin, Texas-based automaker sold 10% less Model 3 compact cars and Model SUVs, which make up the majority of its deliveries.
“Tesla prices must change frequently in order to match production with demand,” CEO Elon Musk wrote on X Sunday.
The automaker cut the price of the revamped Model 3 in China by 14,000 yuan ($1,930) to 231,900 yuan ($32,000). It also cut Model Y prices by a similar amount. Musk also trimmed the price of one model of the Model 3 in Germany to 40,990 euros ($43,670.75) from 42,990 ($45,750) euros.
In the U.S., Tesla slashed $2,000 off Model Y SUVs, Model X SUVS, and Model S sedans by $2,000. It also cut $4,000 off the price of Tesla’s Full Self-Driving amid a push to increase its collection of user data; just days earlier, the company slashed the subscription price of the software to $99 per month from $199 per month.
Prices across other countries in Europe, the Middle East, and Africa — areas where, as of last week, Musk now oversees Tesla sales — have also been slashed, Reuters reported.
Tesla stock dropped more than 4% in pre-market trading Monday to just over $140 per share, following a terrible week for the company. The stock had already — repeatedly — hit new 52-week lows last week after analysts cut their ratings and price targets in the wake of mass layoffs and the departure of multiple executives.
The layoffs, according to multiple analysts, confirmed that Tesla is grappling with a serious demand issue.
“[T]he sweeping layoffs announced yesterday, amounting to a reduction in crewed production capacity, should now leave no doubt that the decline in deliveries has been a function of lower demand and not supply,” J.P. Morgan analysts wrote last week.
On Friday, Tesla recalled thousands of Cybertruck electric pickups, revealing that just 3,878 units have been sold since the model first went out for deliveries in November.
Tesla will report its full first-quarter results on Tuesday after the market closes. Musk worried an already-concerned base of investors and analysts on Saturday when he postponed his pending meeting with Indian prime minister Narendra Modi. The two men were set to announce a massive investment by Tesla into the country.
“Unfortunately, very heavy Tesla obligations require that the visit to India be delayed, but I do very much look forward to visiting later this year,” Musk wrote on X over the weekend.