Skoda launches cheaper electric SUV to counter Tesla price cuts

Skoda is selling a new entry-level version of the Enyaq battery-electric SUV in Europe, partly in response to Tesla’s recent price cuts for its electric cars.

Skoda's Enyaq 50 reduces the battery pack size to 52 kilowatt hours, bringing its starting price below 40,000 euros ($44,000) at 39,990 euros in Germany. The Enyaq previously started at 48,900 euros in Germany for the long-range 80 model.

The move will counter price reductions that Tesla began in January, said Skoda’s head of sales and marketing, Martin Jahn.

Tesla’s price cuts reduced the entry price of its Model Y SUV to 44,890 euros in Germany, putting it below the cheapest Enyaq 80.

“Of course, it is in response to Tesla price cuts, but also some markets were asking us bring a cheaper car with a shorter range,” Jahn told Automotive News Europe.

The 50 has a range of 366 km (227 miles) compared to 542 km for the 80. The cheapest Model Y is rated at 455 km.

Adding an entry model was a smarter move than cutting prices, Skoda CEO Klaus Zellmer told journalists at the brand’s headquarters in Mlada Boleslav, near Prague.

“With Tesla reducing the price in the steps they have done so far, the residual value drops by exactly what they drop the price, demolishing [used] values. That is certainly not our strategy,” Zellmer said.

Skoda will only offer the 50 version in selected European markets, including Germany, Belgium and Netherlands.

“Some markets ask for it. some markets do not,” Jahn said.

Skoda’s home market of the Czech Republic is one market that will not take it. “Instead, we will introduce an all-inclusive leasing rate on the [long-range] 80 that beats Tesla,” Jahn added. The new cheaper price unlocks incentives in some markets, he said.

Tesla is classed as a premium brand by Automotive News Europe, but recent price cuts have positioned the Model Y and Model 3 among volume rivals, including the Enyaq.

Tesla sold 66,623 Model Ys in Europe in the first three months, according to figures from Dataforce, against 9,972 for the Enyaq.

Skoda had initially planned include the 50 model at launch in 2020 but cut it to focus on higher-spec versions of the 60 with its 58-kWh battery pack and the 80, which has a 77-kWh pack. This strategy was in response to production restrictions caused by the supply chain shortages, Jahn said.

Rising raw material prices have forced Skoda to increase prices. The 50, which now costs 39,990 euros, was initially priced at 33,800 euros before it was axed from the launch range.

Skoda will revamp the Enyaq and Enyaq coupe in 2025 using the new ‘modern solid’ design language previewed by last year’s Vision 7S electric SUV concept.

The range will be joined next year by the Elroq compact SUV, a shortened version of the Enyaq, using the same MEB electric platform.