Unable to sell Reuters Tesla\’s Shanghai plant Model Y output slashed by 20%

Industry data shows that since March this year, the U.S. electric vehicle manufacturer Tesla (TSLA-US) has reduced the production of Model Y at its Shanghai plant by double digits due to sluggish demand in the Chinese market. And major car manufacturers are engaged in price wars.

Industry data shows that since March this year, the U.S. electric car manufacturer Tesla (TSLA-US) has reduced the production of Model Y at its Shanghai plant by double digits. The reason is due to sluggish demand in the Chinese market and the large volume of major car manufacturers. Fight a price war.
According to a Reuters report on Friday (24th), an unnamed person revealed that Tesla’s Shanghai plant plans to cut Model Y production by at least 20% in the second quarter.
Data from the China Association of Automobile Manufacturers shows that China\’s Model Y production was 49,498 units in March and 36,610 units in April, a decrease of 17.7% and 33% respectively from the same period last year.
In addition, Tesla produced 287,359 Model Y and Model 3 vehicles in China in the first four months of this year, a 5% decrease from the same period last year.
It is unclear whether this wave of production cuts will continue into the second half of the year or extend to Model 3. It is also unclear whether Tesla\’s U.S. and German factories will also adopt similar production reduction measures.
China is Tesla\’s second largest market. Most of the electric vehicles produced by the Shanghai plant are sold locally.
A fierce price war has erupted among Chinese electric vehicle manufacturers amid an economic slowdown.
Tesla in April lowered the price of Model Y in China to the lowest level since the car was first launched in China in 2021. Tesla also offered Model 3 buyers a zero-interest loan program to boost sales.
In addition, the U.S. government is preparing to use tariffs on strategic industries such as Chinese electric vehicles, but Tesla CEO Musk does not agree with this approach.
Musk said Thursday that he does not support President Biden\’s move to impose tariffs on Chinese-made electric vehicles.
\”Neither Tesla nor I asked for these tariffs and in fact I was surprised when they were announced,\” he said.
Things that restrict freedom of trade or distort markets are bad.
\”The Office of the United States Trade Representative (USTR) announced on Wednesday that it will impose significant additional tariffs on a series of Chinese products sold to the United States, including electric vehicles and batteries, computer chips, and medical products. Some of the tariffs will take effect on August 1.
According to \”Reuters\”, Biden will increase the tariff rate on China\’s electric vehicles to 100% and the tariff rate on semiconductors from 25% to 50%.
The USTR said in a federal notice that the 30-day public comment period will end on June 28.
Tesla has been struggling this year as growing competitive pressure around the world, especially in the Chinese market, led to its largest revenue decline since 2012 in the first quarter.
Tesla’s stock price has fallen nearly 30% since the beginning of the year.

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