Tesla Inc. TSLA is doling out more incentives in China, apparently in its push to sell more cars to consumers who are handicapped by slowing economic growth.
What Happened: Tesla is now offering a discount of up to 8,000 yuan ($1,105) on the final price of those cars that are in stock in China and have auto insurance from one of its insurance partners, reported CnEVPost, citing a poster on the EV-maker’s China’s Weibo account. The offer is valid between Nov. 8 and Dec. 31.
The report said that the U.S. company and domestic electric vehicle upstarts such as Nio Inc. NIO use a build-to-order model, and most of the cars in their inventory come from canceled orders.
Tesla reportedly said in the poster that the discounts are also applicable to current model vehicles that are not brand new, “show cars” and vehicles used for test drives. Official Tesla-certified second-hand vehicles are not included in the offer.
The discount is cut in half for those customers who take delivery from Dec. 1 to 31.
Why It’s Important: Tesla announced about 5% price cuts for its Made-in-China vehicles in the last week of October following a string of rate increases earlier this year. After deliveries were hit by the COVID-19 resurgence in the second quarter and factory line upgrade-related shutdowns in July, the company is aiming for a pick-up in sales pace in the fourth quarter.
Since seeing off these challenges, the company has fought back strongly. August sales rose to near-record levels, September sales hit a record and October deliveries, reported last week, were also robust.
Price Action: Tesla shares closed Monday’s session down 5.01% at $197.08, according to Benzinga Pro data.
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