Business Essentials for Professionals


Tesla Pushes To Boost Sale – Drops Production Of Cheapest Variants Of Model X, S Cars

Tesla Pushes To Boost Sale – Drops Production Of Cheapest Variants Of Model X, S Cars
Tesla is putting in all efforts to boost up sale of its electric vehicles by adjusting prices of its cars throughout its product range as well as dropping out the standard-range variants of its Model X and Model S from its product offering. This move comes close to heels of the United States based electric car maker announcing record deliveries.
Variants of the Model X sport-utility vehicle and Model S sedan would now only be available under the "Long Range" and the more expensive "Performance" range of its cars which would simplify the product offering from the company. The prices of cars in its entry level Long range variant category were also reduced by Tesla.
However there is expected to be a rise in starting prices because of the discontinuation of the standard-range variants. It is now expected that not including possible buying incentives as implemented by various national governments, the starting price of the Model X and the Model S would be $84,990 and $79,990 respectively.
The starting price of its mass-market Model 3 has also been reduced by Tesla to $38,990.
In the second quarter of the current year, Tesla recorded a 51 per cent quarter on quarter increase in the global deliveries of its three models at a record 95,200 vehicles, the company announced earlier this month. Out of the total number of vehicles delivered by the company in the aforesaid period, about 80 per cent was comprised of the Model 3 which further highlights the importance of the variant as the ,most crucial component for its growth strategy and profitability.
"To make purchasing our vehicles even simpler, we are standardizing our global vehicle lineup and streamlining the number of trim packages offered for Model S, Model X and Model 3," Tesla said in a statement. "We are also adjusting our pricing in order to continue to improve affordability for customers," it added.
The company further expects that there would be a further increase in its deliveries in the third quarter as well.
While Tesla has been focusing on China – the largest market in the world for electric vehicles, for growth and profitability, the latest move announced by the company increased the starting price of its Model X to 790,900 yuan ($115,068) and that of its Model S to 776,900 yuan.
A production unit in Shanghai, China, is being constructed by Tesla where the company initially plans to manufacture the Model 3 cares. Currently the company is accepting orders for the China made version of the Model 3 at a starting price of 328,000 yuan.

Christopher J. Mitchell

Markets | Companies | M&A | Innovation | People | Management | Lifestyle | World | Misc