Why is Tesla lowering prices while raising prices at the same time?

Almost all industry insiders assume that the price of the new Tesla Model 3 will further decrease, staying around 200,000 yuan. However, Tesla unexpectedly raised the starting price of the new Model 3, making it 28,000 yuan more expensive than the old model.

On September 1st, the new Model 3, known as the Refreshed Model 3, was officially launched and pre-sales began in mainland China. The starting price for the rear-wheel drive Refreshed Model 3 is 259,900 yuan, while the starting price for the long-range all-wheel drive Refreshed Model 3 is 295,900 yuan. This is the first redesign of the Model 3 in six years, and deliveries are expected to start in the fourth quarter of this year.

When comparing the new Model 3 with the old Model 3, it was found that the new model did not increase in price across the board.

The price of the rear-wheel drive Refreshed Model 3 increased by 28,000 yuan, but the all-wheel drive version (previously known as the Performance All-Wheel Drive) decreased by 36,000 yuan.

In conjunction with the price adjustments for the S and X series, Tesla's pricing strategy can be summarized as follows: improving the configurations of cheaper cars and making high-performance cars more affordable.

An automotive marketing professional believes that Tesla's price adjustments are reasonable. Lowering the price of the old model helps clear inventory, while setting the price of the new model higher than the promotional price is a common sales strategy during model upgrades. Additionally, due to the intensifying price competition in the domestic automotive market and increased consumer hesitation, further price reductions for the new model may lead to the problem of "old models not selling and new models not being ordered."

1. Changes to the Model 3:

In terms of configurations, the new Model 3 has increased its range by about 50 kilometers compared to the old model. It has also added a rear LCD screen, ventilated seats, and optimized interior and exterior decorations. The new model has removed all levers, integrating functions such as voice control, windshield wipers, and high beams into the steering wheel, while shifting gears is done through the central control screen.

Furthermore, some configurations from the high-end Model S have been transferred to the Model 3, such as the addition of a fiery red paint option and the adoption of the same central control screen as the Model S.

Compared to the old model, the performance of the new all-wheel drive version has been slightly downgraded. The acceleration from 0 to 100 kilometers per hour has increased from 3.3 seconds to 4.4 seconds, and the top speed has decreased from 261 km/h to 200 km/h.

After the release of the new Model 3, the price difference between the Model 3 and the Model Y has further narrowed, with the Model Y being only 4,000 yuan cheaper than the Model 3.

1. Changes to the S/X Models:

At the same time, Tesla has significantly reduced the prices of its high-end models, the Model S and Model X, with price reductions ranging from 110,000 yuan to 220,000 yuan.

The starting price for the dual-motor all-wheel drive Model S is 698,900 yuan, while the starting price for the three-motor all-wheel drive Model S Plaid is 828,900 yuan. The starting price for the dual-motor all-wheel drive Model X is 738,900 yuan, and the starting price for the three-motor all-wheel drive Model X Plaid is 838,900 yuan. Meanwhile, users who purchase the Model S or Model X models can also enjoy the option of 5 color car paints at zero cost, free use of 1 year of premium in-car entertainment, and limited-time transfer of FSD (Full Self-Driving Capability) services.

The fact that the Model 3 is not continuing to reduce its price does not mean that Tesla has given up on the market below 200,000 yuan.

During Tesla's Battery Day in 2020, Musk stated that the expansion of the 4680 battery production will make a $25,000 (approximately 180,000 yuan) autonomous electric vehicle a reality by 2023. After the release ceremony of the Model 3, Tesla even posted a sketch of a low-cost model with the codename "Model Q" on Weibo. The latest news, according to information from insiders cited by 36Kr, is that "this low-cost model is a smaller version of the Model Y. Tesla is building an annual production capacity of up to 4 million vehicles, with 1 million of them being produced in China."