Car wars: Tesla cuts price of Model Y

Model Y

Elon Musk has taken up the mantle to his vehicle manufacturer rivals by cutting the price of the Tesla Model Y by $US3,000.

The Model Y, an electric compact crossover utility vehicle, started being delivered by Tesla to pre-ordered customers in March.

The price cut comes after Tesla said it delivered about 90,650 vehicles in the second quarter, showing that it had withstood the economic downturn caused by the coronavirus better than most competitors. The Model Y is now being sold for just below US$50,000.

The price cut on the Tesla Model Y is expected to boost orders at a time when all vehicle makers are being hammered in the economic downturn.

Tesla cut prices on several of its models in May, lowering the cost on the base models and performance versions of the Model S and Model X by US$5,000. All versions of the Model 3 had a price cut of US$2,000 (prices are different for the Model 3 in China due to government subsidies).

Tesla said on 2 July that despite the temporary shutdown of its Fremont, California factory due to the coronavirus pandemic, it delivered 80,050 of its Model Y and Model 3 vehicles and 10,600 of its Model S and Model X vehicles. Wall Street analysts had predicted Tesla would sell 72,000 in total.

Ford’s second quarter sales were down 33.3% and daily rental was down 94%. The major positives saw Ford Ranger’s overall sales gain 19.8% with sales totalling 25,008 pickups for the quarter. The Ford’s Explorer is the US’s best-selling midsize SUV with sales of 101,149 vehicles. Total Explorer sales were up 12.4%.

General Motors saw its sales drop 34% in the second quarter of the year, with sales dropping from 746,659 to 492,489 for the period.

Fiat Chrysler Automobiles sales figures for the quarter showed a 39% decline.

London UK-based Trend forecaster IHS Markit is projecting a 22% drop in the global vehicle market in 2020, with electric vehicle sales expected to drop by 18%.

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