Recently, Tesla CEO Musk said in an interview that "there is no unfairness in price increases, the demand is there." Musk's subtext is that the price increase is because the demand is too strong and the supply exceeds the demand. So you can only increase the price first. In fact, his words are not unreasonable. Since December 31 last year, Tesla has raised prices several times in a row. Hot orders, short supply, pick-up of cars, etc. for several months have become the norm for Tesla. Tesla's current official website in China shows that the delivery time is 20 to 24 weeks, that is, 5 to 6 months.
If so, will Tesla still reduce prices? My judgment is that Tesla will definitely cut prices again.
First of all, Musk emphasized that the price increase is related to supply and demand, that is, the supply exceeds demand, so the price increases. And if the independent brand is strong enough to compete with Tesla, and because the product strength of the independent brand model is strong, resulting in a decline in Tesla sales, then tesla will not reduce the price? I think there is a good possibility of price cuts.
Secondly, the price increase of this round of new energy vehicles is also directly related to the rise in raw material prices. It is not only Tesla that has raised prices, but also almost all new energy vehicle companies.
The shortage of chips in the rise in raw material prices is mainly due to the repeated fluctuations of the epidemic, and the reason for the rise in battery prices is because of the Russian-Ukrainian conflict, and the price of battery raw materials has risen. So these two major price increase factors, in fact, with the gradual control of the epidemic, including the Russian-Ukrainian conflict is resolved, then new energy vehicles will have a lot of room for price reduction, if Tesla chooses not to reduce prices, then other car brands will definitely choose to reduce prices. So by that time I didn't believe Tesla wouldn't drop on its own.
Third, from the perspective of Tesla's current and future development strategy, tesla's biggest advantage at present is that it has a blockbuster tesla model 3.
However, from the perspective of the richness of the product, its product line is not very rich, and even less than its own brand. With the future Tesla Model 3 in the market heat is getting lower and lower. There are more and more competing models, so a very difficult problem in front of Tesla is how Tesla should maintain the continuous sales of the Model 3 and Model Y.
From the current tesla model design, these two models should not have much room for improvement in the future. At best, upgrade the battery. Therefore, from the perspective of Tesla's corporate strategy, these two models will definitely continue to reduce prices in the future.
The fourth reason is that Tesla's gross profit margin is currently very high, according to Tesla's report in the first quarter of 2022. At present, Tesla sells an average car and makes a net profit of $10,700, about 68,600 yuan. Gross margin reached 32.9%. Such a high gross profit margin has even surpassed luxury car brands such as Mercedes-Benz BMW Audi. This also means that Tesla actually has a very large room for price reduction.
Therefore, based on the above four reasons to judge, in fact, Tesla will reduce prices in the Chinese market in the future. So if you also want to buy a Tesla, don't worry.