The rivalry between Tesla Motors and BYD is getting real, with both companies eyeballing every dollar of the other’s pricing.
BYD on March 4 launched a new version of its top-selling car in its home market at a lower price than its predecessor model. The sticker for a new Yuan Plus crossover, sold as the Atto 3 in export markets, is just $16,644. That is roughly 12% less than the version it replaced.
BYD sold 412,202 Yuan Plus BEVs in 2023, with over 100,000 of them exported.
While BYD’s pricing strategy in its home market is designed to build market share and brand dominance, and put pressure on Tesla, the low pricing is a bit disconnected from pricing in export markets. The price of the Atto 3 in Australia, for example, is $31,336.
Tesla is not standing idle. BYD’s move comes after Tesla layered $4,800 in new incentives on its Model 3 and Model Y in China last week.
That’s in China. Tesla is working the discount dials like any other automaker in the U.S. Indeed, while it cut prices in China, it raised them in the U.S. where BYD doesn’t sell BEVs, and many carmakers are delaying launches and production of new BEVs.
On March 1, Tesla increased the prices of the Model Y RWD and Model Y Long Range by $1,000 after cutting prices by $1,000 in February.
Tesla is increasingly tinkering with pricing to try and move the sales needle. At the end of February, Elon Musk’s BEV company learned that BYD has no short-term plans to try and enter the U.S. market when a top BYD executive said a U.S. launch would not happen anytime soon in part because of political tension between the U.S. and China.
In the past, Tesla also has used discounted charging rates, and even offered free charging for specific periods at its fast chargers, to lure new buyers so as not to affect resale prices.
Many automakers, such as General Motors and Ford, are now paying Tesla so its buyers can have access to the BEV maker’s reliable supercharger network, ironically making it easier for Tesla to offer discounted charging rates as an incentive to its buyers – paid for by its rivals.
