Tesla Model Y trim gets minimal price increase in China

Credit: Tesla Asia/Twitter

Tesla Model Y Rear-Wheel-Drive units in China received minimal price increases of less than a percentage point this week.

Tesla increased the price of the base Model Y trim level from 259,900 yuan ($38,167.27) to 261,900 ($38,460.97). It is only a 0.8 percent increase in price and is relatively minimal, but still a slight uptick.

Tesla’s Design Studio for China reflects the new price increases

The price increase follows a sharp rebate on Model 3 and Model Y vehicles in China at the beginning of the year. In early January, Tesla cut prices of the Model 3 sedan and Model Y crossover by between 6 and 13.5 percent, making them vastly more affordable for consumers.

The company made the same cuts in the United States, with the biggest discounts coming on the Model Y, with reductions by as much as $13,000. After the entire U.S. lineup of Model Y trims was added to the IRS’s list of vehicle qualifying for federal tax credits in early February, Tesla pushed prices up slightly.

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The adjustments to pricing in both the Chinese and U.S. markets could help Tesla level out some potential profitability losses from the reduced prices. Tesla has among the best vehicle profit margins in both China and the United States. The slight uptick in price could help soften investor worries by making slightly more per car.

Tesla builds its cars for the Chinese market in Shanghai at its dedicated production facility known as Gigafactory Shanghai. While this plant builds cars for Chinese customers, it is also the company’s export hub for customers in other markets, including Europe and Australia.

The Shanghai plant was a major contributor to some of Tesla’s production issues last year, as the company said its manufacturing and delivery challenges in 2022 “were largely concentrated in China.” This is no indication of softening demand, however, as Tesla has still maintained the lead in sales of fully-electric models.

The factory builds more than 750,000 vehicles per year. It is a major contributor to Tesla’s overall production figures, accounting for more than 50 percent of the company’s global deliveries in the past two years.

I’d love to hear from you! If you have any comments, concerns, or questions, please email me at joey@teslarati.com. You can also reach me on Twitter @KlenderJoey, or if you have news tips, you can email us at tips@teslarati.com.

Joey Klender: Joey has been a journalist covering electric mobility at TESLARATI since August 2019. In his time at TESLARATI, Joey has broken several big stories, including the first images of the Tesla Model S Plaid, the imminent release of the 4680 Model Y through EPA certification, and several expansions to the Lucid AMP-1 factory in Arizona, to name a few. His stories have been featured in several publications, including Yahoo! Finance, Fox News, CNET, and Seeking Alpha. In his spare time, Joey is playing golf, watching MMA, or cheering on any of his favorite sports teams, including the Baltimore Ravens and Orioles, Miami Heat, Washington Capitals, and Penn State Nittany Lions. You can get in touch with joey at joey@teslarati.com. He is also on Twitter @KlenderJoey.
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