Tesla has caused a ruckus in the electric vehicle market by slashing the Model Y's price to $46,990, which is now $759 less than the average transaction price for a car or truck in the U.S.
- This massive $20,000 reduction from a year ago is one of the largest price cuts in automotive history, leaving competitors scrambling to keep up.
Think Locally: Traditional automakers like Ford, GM, and BYD are feeling the pinch as Tesla leverages its control over a large portion of its supply chain, something that other car manufacturers haven't quite mastered yet. This aggressive pricing strategy could force some EV makers to hit the brakes on their ambitions altogether.
Act Globally: It's not just the U.S. market that's seeing price drops; Tesla has also been cutting prices in other countries.
- French carmaker Renault calls Tesla's price reductions in their market "a challenge," while China's auto industry association urged an end to the price wars in March.
- The intense competition may even cause some Chinese automakers to shut down, warns Nio's CFO Steven Feng.
- "Price wars are breaking out everywhere," says Ford Motor CEO Jim Farley, and it seems Tesla is leading the charge.
