Tesla once again announced a price cut in the U.S. market, with the highest price cut reaching US$5,000, equivalent to more than 30,000 yuan. This move may lead to another price cut in the Chinese market, which undoubtedly puts huge pressure on domestic new energy vehicles.
1. Tesla holds the baton in the price war
Since the Tesla Shanghai factory was put into production in 2019, Tesla has frequently launched price wars. It took the lead in reducing the price of model 3 to less than 300,000 yuan. In 2020, model 3 will become the first domestic sales of new energy vehicles with more than 200,000 yuan; Reducing the price of model Y to less than 300,000 also triggered a wave of buying.
However, since then, with the rise of domestic new energy vehicles, BYD has won the recognition of domestic consumers with its exclusive blade battery that provides higher safety. With BYD's efforts, the benchmark model Han has gradually become a threat to model3; The dynamic technology DMI drives the development of new energy vehicles, and DMI technology models account for nearly half of BYD's new energy vehicle sales.
Internet car manufacturers have also reached less than 300,000. Many Internet car manufacturers have seized the market with a siege of wolves. Under the siege of many new energy car companies in China, model 3 and model Y have not been so eye-catching since 2022. It also caused Tesla's sales in 2022 to fail to meet expectations.
At the beginning of this year, Tesla started the price reduction mode again. The maximum price reduction of model 3 and model Y was nearly 50,000, and the sales surged again. Model 3 achieved 26,000 sales in March this year, and model Y even won the first place in domestic SUV sales with 39,700 units. The name shows the power of Tesla's price cuts.
Tesla’s price reduction is based on the fact that its production cost is low enough. After the sharp price cut, its profit margin is still high. Among the domestic new energy auto companies, except for BYD’s profit, other new energy auto companies have almost no profit. With the baton in hand in the price war, Tesla can further reduce prices at any time to achieve sales growth, and the follow-up price reduction of domestic new energy vehicles will lead to further expansion of losses.
2. Domestic new energy vehicles will continue to be under pressure
After the price reduction has achieved results, Tesla may continue to carry out price reduction promotions. After all, it has sufficient advantages in terms of cost, and it is still continuing to reduce the cost of car production and sales, which is inseparable from its unique mode of operation.
Tesla insists on self-propelled car manufacturing, regardless of whether it is in the United States or China. The factory is exclusively owned by Tesla; and in terms of production, it has previously proved that its car manufacturing method has the lowest cost. In March this year, Tesla Said that it is planning to change the way vehicles are assembled and reduce the production footprint, which is expected to further reduce the cost of automobile production.
Tesla is also advancing in battery technology. The 4680 battery it developed can further increase battery capacity, improve battery safety and reduce costs. At present, the factory it cooperates with Panasonic has promoted the mass production of 4680 batteries. Power batteries account for a relatively high cost of new energy vehicles, and the introduction of 4680 batteries will further reduce costs. The news pointed out that the production cost of the new generation of models is expected to further reduce by 50%.
Tesla's sales model is also different. Tesla's 4S store is exclusively operated by him, thereby stripping out middleman costs, which will help it reduce overall operating costs and become its confidence to further reduce prices. In contrast, most other auto companies adopt the franchise model, and middlemen need to obtain part of the profits, which increases the cost of sales.
At present, Tesla's cheapest model 3 sells for more than 200,000 yuan, and domestic new energy vehicles are dominated by domestic new energy vehicles below 200,000 yuan. However, Tesla has intends to enter the market below 200,000 yuan. La plans to launch more than 100,000 models. With the further reduction of its production cost and the need to seize the market, it may launch models with less than 200,000 this year at the earliest.
All of these put pressure on domestic new energy vehicles, especially Tesla's possible launch of models below 200,000 yuan, which can be said to be a huge pressure on domestic new energy vehicles, which means that domestic new energy vehicles can previously obtain sales at prices below 200,000 yuan. It is hoped that it will be greatly compressed. At that time, it will be the time to see the truth for domestic new energy vehicles.