BEIJING — U.S. electric vehicle maker Tesla Inc. said on Friday it has cut the starting price for China-made Model 3 sedans by 10% to qualify for subsidies in the world’s biggest auto market.
Tesla, which started delivering cars from its $2 billion Shanghai car plant in December, said in a statement it has cut the starting price for its Standard Range Plus Model 3 sedans to 271,550 yuan ($38,463.17), after receiving 20,250 yuan per car as EV subsidies.
China had announced plans in 2015 to end subsidies for electric vehicles this year, but said in March it would extend them. However, it said the subsidies will apply only to passenger cars costing less than 300,000 yuan.
Qualifying for subsidies should help improve Model 3 volumes in a sluggish economy still struggling to recover from the global health crisis.
Tesla CEO Elon Musk’s aggressive calls to re-start the economy post-coronavirus have prompted some investors to wonder whether the company is on as solid a footing as its Q1 earnings briefing suggested.
One day after Tesla Inc posted its third quarterly profit in a row, hedge fund manager David Einhorn, one of the electric carmaker’s best-known critics, lobbed questions about the company’s financials at its two top executives.
Retail investors, on the other hand, seemed unfazed by the pandemic, and instead sought more information about Tesla’s goals for long-term improvement.