Tesla cuts prices in Europe, U.S., China amid sales slump

Tesla cut prices in its major markets including in the U.S., Europe and China amid slumping sales and a glut of inventory.

Tesla reduced the starting price of the revamped Model 3 in China by 14,000 yuan ($1,930) to 231,900 yuan ($32,000), its official website showed on Sunday.

In Germany, the automaker trimmed the price of its Model 3 rear wheel drive to 40,990 euros ($43,670.75) from 42,990 euros, where the price has been since February.

There were also price cuts in many other countries in Europe, the Middle East and Africa, a Tesla spokesperson said.

In the U.S., Tesla cut prices of its Model Y, Model X and Model S vehicles by $2,000 on Friday.

The price cuts come after Tesla reported this month that its first-quarter global deliveries fell 8.5 percent to 386,810, as the automaker faced softening demand for electric vehicles and an intensifying price war for EVs, especially against cheaper Chinese rivals.

Tesla has been slow to refresh its aging models as high interest rates have sapped consumer appetite for big-ticket items.

Self-driving bet

Tesla on Saturday reduced the price of the driver-assistance software that it calls Full Self-Driving, or FSD, by a third to $8,000 in the U.S.

CEO Elon Musk is betting the technology will become a major source of revenue. But he has for years failed to achieve the goal of self-driving capability, with the technology under growing regulatory and legal scrutiny.

In recent weeks, Tesla has rolled out new versions of FSD software, and Musk has said the company will unveil a robotaxi on Aug. 8.

Reuters reported on April 5 that Tesla has scrapped plans to produce an inexpensive car that investors have been counting on to drive mass market growth in favor of robotaxis.

Musk posted that "Reuters is lying" after the report, without citing any inaccuracies. He has not spoken further about the model, leaving investors clamouring for clarity.

Musk said last Monday that the automaker will lay off more than 10 percent of its global workforce as the automaker braces for its first annual drop in deliveries.

On Wednesday, Tesla said in its proxy statement that it will ask shareholders to vote again on a $56 billion compensation package for Musk that was voided by a Delaware court in January.

And on Friday, the company recalled almost 3,900 Cybertruck pickups to repair or replace accelerator pedals that can dislodge and cause the vehicle to unintentionally accelerate, increasing risk of a crash.

Musk also postponed a planned trip to India, where he was expected to meet with Prime Minister Narendra Modi, saying he had to deal with “heavy obligations” at Tesla.

Tesla reports first-quarter earnings on April 23. Its stock is down more than 40 percent this year on concern about slumping sales, intensifying competition in China and Musk's risky plan to go all out on autonomy.

Reuters and Bloomberg contributed to this report