Tesla: Significant price cut of electric cars in Germany

After cutting the price of its Model 3 and Model Y in China, Tesla has also reduced the price of the Model Y significantly in Germany, according to the company's website.

The prices of the Model Y Long Range and Model Y High Performance sank by €5,000 (US$5,440) each to €49,990 and €55,990, with a 9 percent and 8.1 percent reduction respectively.

The Model Y rear-wheel-drive version also dipped by €1,900, a 4.2 percent decrease, to €42,990.

According to KBA (Germany's Federal Motor Vehicle Authority), Tesla struggled in 2023 in the German market, with new registered vehicles falling 9 percent to 63,685 vehicles, while overall electric vehicle sales in Europe's largest economy grew 11.4 percent, said Reuters.

Consequently, Tesla temporarily lost its position as the largest seller in the German electric car market, with Volkswagen overtaking Tesla's 12.1 percent market share with 13.5 percent.

As the price war between electric car makers intensifies, BYD is also lowering the prices of its electric cars in Germany. It is reported that BYD has cut its electric car price by up to 15 percent in Germany in an effort to extend its lead in the European market.

According to Reuters, Germany's EV subsidy program was set to last until the end of 2024, but ended early in 2023 on December 18, in an abrupt change that hit German EV makers hard. Currently, German automakers are struggling to remain competitive by lowering the prices of their electric cars to the levels of their Chinese and United States rivals.

Tesla announced last week that it would suspend most of its car production at its Berlin factory from January 29 to February 11, blaming tensions in the Red Sea. Since a series of attacks on Red Sea vessels last December, international shipping giants have altered shipping routes, leading to longer shipping times and parts shortages.