Tesla temporarily cuts prices on some Model Y cars in the U.S. From Reuters

©Reuters. FILE PHOTO: Model Y cars are pictured during the opening ceremony of the new Tesla Gigafactory for electric cars in Gruenheide, Germany, March 22, 2022. Patrick Pleul/Pool via REUTERS/File Photo

(Reuters) -Tesla Inc has temporarily cut prices on some of its Model Y cars in the United States until Feb. 29, less than a month after the automaker cut Model Y prices in Germany.

Tesla (NASDAQ:) reduced prices for its rear-wheel-drive Model Y and Model Y Long Range by $1,000 to $42,990 and $47,990, respectively, a discount of 2.3% and 2% from previous prices .

According to the website, the prices of the Model Y Performance variant and other models have remained unchanged.

Prices of the new rear-wheel-drive Model Y and Long Range model will be reduced for deliveries between now and February 29, Tesla said in a notice on its website, adding that that price will increase by $1,000 or more starting on 1st March.

Tesla cut prices of its Model Y cars in Germany last month after most car production at its Berlin plant was suspended due to component shortages after attacks in the Red Sea caused shipping disruptions .

In January, Tesla also warned of “noticeably lower” sales growth this year as it focuses on production of its next-generation electric vehicle, codenamed “Redwood (NYSE:).” The latest price cuts are expected to further weigh on Tesla’s margins, already hit by a price war that began more than a year ago.

The latest price cuts come as Tesla is bracing for cooling demand and growing competition from a growing number of affordable electric vehicles, such as those produced by China’s BYD (SZ:), which has overtaken Tesla as the top EV maker at world in the last quarter of 2023.

In another sign of cooling demand for electric vehicles, rental company Hertz Global Holdings (OTC:) in January said it had sold about 20,000 electric vehicles, including Teslas, from its U.S. fleet and was opting for powered vehicles gas due to higher costs related to collisions and accidents. damage to electric vehicles.

Tesla shares are down 22.1% this year.

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