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Tesla cuts prices in key markets following falling sales

Tesla has cut some of its prices in a number of crucial markets after the electric car maker has seen a drop in the number of sales. This means that buyers in the US, China, and Germany will be among those who can buy one of its models for less money.

A “price war” has begun between electric car makers especially as they face fierce competition from Chinese companies expanding to western markets. Tesla is set to report its financial results for the first quarter of 2024. “Tesla prices must change frequently in order to match production with demand,” Tesla owner Elon Musk posted on X.

In China, the company set the starting price of the recently updated Model 3 at 14,000 yuan (£1,562) less, while prices of the Model Y, Model X, and Model S were all cut in the US by $2,000 (£1,616). Many countries in Africa, Europe, and the Middle East also saw price cuts, Reuters reported.

It triggered a price war a year ago after it cut its prices at the expense of profit margins. The company has also been slow to update some of its aging models compared to Chinese rivals. BYD and Nio are among the brands from China that has been releasing cheaper models while Chinese smartphone maker Xiaomi has just launched its first ever electric car last month.

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