War in the EV market as Tesla slashes prices again

Tesla has announced price cuts for the second time this year in a renewed bid to outprice competitors and stimulate demand. 

Certain models have had their price slashed by 5-10%. This follows even higher cuts of up to 20% for some new models earlier in the year. According to one analyst, price reductions in January led to a 30% boost in sales. 

With demand for EVs slowing down, manufacturers are using price as a weapon to attract consumers. In response to Tesla’s earlier cuts, Ford responded with a price reduction of their own. What firms will want to avoid though is a race to the bottom. Price wars can be lethal, but Tesla hold a strong position as their cars, already priced higher than most competitors, have a large profit margin for which they are able to squeeze. That being said, lower profits won’t please shareholders!