SHANGHAI, Jan. 9 (Reuters) – Tesla potential (TSLA.O) Buyers in China are waiting longer to get their hands on certain versions of its Model Y, suggesting the electric car maker’s decision to slash prices is driving demand in its second-largest market.
Tesla cut prices by 6% to 13.5% on Friday, bringing some of the prices of its cars closer to BYD’s best-selling models in a move analysts said was a sign the price war could escalate as demand in China falters.
Tesla’s website showed that the wait time for orders for rear-wheel drive and long-range versions of the Model Y was a week longer on Monday than on Friday. The wait, as of Monday, was two to five weeks on those models. Wait time for all Model 3 and Model Y performance releases remained from one to four weeks as of Monday.
“It (hold time) is an early indication that the price cuts are having their intended effect, which is to boost demand,” said Garrett Nelson, an analyst at CFRA Research.
Shares of the company rose about 6% to close at $119.77 on Monday, after losing 68% over the past 12 months. It was the most traded stock on US stock exchanges, with more than 228 million shares traded.
As of Monday, Tesla had not made any adjustments to the January production plan for its Shanghai plant, with assembly lines suspended from Jan. 20 until the end of the month, a person familiar with the matter said.
Nelson added that production of Tesla cars has outsold sales for three consecutive quarters and the company has chosen to cut prices and take some extra time at the Shanghai factory to rebalance supply and demand.
Angry Chinese owners who bought Tesla cars in late 2022 and missed out on the extra discount said they were waiting for a response from the company to their demands for some kind of compensation after a flurry of impromptu protests.
A Tesla representative told Reuters on Saturday that the company has no plan to compensate these buyers for the price cuts they missed. The company did not respond to a request for comment on Monday.
Some buyers in China said they were led to believe further discounts would not come. Many were also looking forward to taking advantage of the nationwide EV subsidy that ended at the end of the year.
Chinese state media has largely chosen not to cover the protests, which online videos have shown have taken place in cities including Beijing, Shenzhen, Chengdu and Xi’an. Reuters witnessed a protest at Tesla’s facility in Shanghai.
Comments on Chinese social media were largely negative towards Tesla buyers who protested, with many online saying they should have understood the terms of the contract.
Separately, starting Monday, Tesla began offering discounts to buyers in Singapore who agreed to buy existing inventory, adding that market China, South Korea, Japan and Australia to those in which it offered new incentives.
(Reporting by Zhang Yan, Brenda Goh) Additional reporting by Akash Sriram in Bengaluru. Editing by Muralikumar Anantharaman, Will Dunham, and Shounak Dasgupta
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