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After New Year's Day, Tesla China took the lead in opening the price reduction model, with the starting prices of the two domestic models hitting record lows, with Model 3 falling by 2.0-36000 yuan and Model Y by 2.9-48000 yuan. I have to say that Tesla Guanxuan price reduction is indeed unexpected, in sharp contrast to BYD, Chery New Energy, Changan Deep Blue and other car companies have announced price increases, and Tesla's sudden price reduction also caused the dissatisfaction of many car owners and went to offline stores to organize and safeguard their rights.

Of course, Tesla is not "partial" to the Chinese market. Shortly after Tesla's price reduction in China, countries including Japan, South Korea, Portugal, Australia, the United States, Norway, Spain, France and the Netherlands also launched price cuts. It can be said that this is a wave of price cuts sweeping the world.

In the Asia-Pacific region, the prices of Model 3 and Model Y sold by Tesla in Japan were reduced by about 10% respectively, while the prices of Model 3 and Model Y models sold in South Korea fell by between 6 million won and 11.65 million won (about 32500 to 63100 yuan). It is also the first time in two years that Tesla has reduced the price of the Model 3 model sold in both countries by $3000 (about 20200 yuan) to $43990, and the Model Y by $13000 (about 87500 yuan) to $52990.

In Europe, in Germany, for example, the Model 3 rear wheel drive version fell 12% to 43990 euros (319300 yuan), while the Model Y rear wheel drive version fell 17 percent to 44890 euros (325900 yuan).

For the sharp reduction in prices around the world, car owners around the world have denounced Tesla on the Internet, and spontaneously organized to safeguard their rights, asking Tesla to give away 100000 yuan worth of FSD or EAP driving aids free of charge. Musk seems to feel a little helpless about the rights protection and compensation demands of car owners. It said on Twitter that when Tesla cut the price, the people who had bought it wanted a lower price, but if the price went up, those who had bought it would not make up the difference for Tesla.

Although the cost is the objective reason for Tesla's price reduction, it is deeper or related to the fact that its sales target does not meet expectations. At present, the United States is Tesla's largest market, followed by the Chinese market. Tesla's combined sales volume in the Chinese and American markets is more than 70% of the total sales. Tesla can stabilize the "number one" position of new energy vehicles only by ensuring sales in the two major markets.

The industry believes that Tesla's global price reduction indicates that a major change is taking place in the relationship between supply and demand of new energy vehicles. Starting in the second half of 2022, the scene that it once took months to pick up the car ceased, and against the backdrop of high inflation, aggressive interest rate hikes by the Federal Reserve and the global epidemic, the growth rate of global new energy vehicles began to slow, while Tesla's production capacity continued to expand. Tesla began to oversupply.

According to official data released by Tesla, Tesla's annual sales of 1.3139 million vehicles in 2022, although an increase of 40%, fell short of the target of 1.5 million set by Tesla's chief executive, Max Ke, and was lower than Wall Street market expectations. causing the stock price to fall all the way.

In addition, Tesla is facing a challenge from Chinese brands of new energy vehicles in the Chinese market. Tesla has always been the top seller of new energy vehicles in the world, and the two main selling products, Model3 and ModelY, almost crush the same class models in their respective market segments, but this pattern was rewritten by Chinese new energy vehicle companies in 2022. In 2022, BYD sold 1.857 million new energy vehicles for the whole year, an increase of 152.5 percent over the same period last year, making it the world's largest new energy vehicle company. Tesla, who has been the global leader in new energy vehicle sales for many years, was taken away.

Tesla lost the title of new energy sales in 2022. Although it is still the world's highest-selling pure electric car company, it has been overtaken by BYD in the new energy vehicle industry, which reached sales in 2022. Perhaps Mr Musk did not expect that BYD, which he did not see a decade ago, is now one of Tesla's strongest rivals in the global market. At the same time, new car-building forces such as NIO and ideal are also growing, and the sales of high-end new energy brands such as Qijie and extreme krypton are increasing, and they are also beginning to erode Tesla's site.

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