EV giant Tesla (NASDAQ:TSLA) has once again lowered prices in the United States to boost demand for its vehicles. The move comes as the auto industry is witnessing a slowdown due to the rising interest rate environment and high inflation.
According to the company’s website, the Model S sedan and Model X sport utility vehicles now cost $84,990 and $94,990, respectively. The company also reduced the cost of its Model 3 sedan by $1,000 and its Model Y crossover by $2,000, respectively.
Since the beginning of 2023, Tesla has reduced prices in China and the US, two important EV markets. In fact, the company has staged a price war in China, where it faces tough competition from BYD Co. (BYDDY).
Last week, Tesla delivered 422,875 vehicles in the first quarter of 2023, up 36% year-over-year. However, it failed to impress investors. However, data from the China Passenger Car Association showed that the business did well in China. Tesla sold 35% more vehicles in March in comparison to last year.
Though price reductions have increased Tesla’s car sales volumes, they are also likely to have an impact on its profit margins. When Tesla releases its Q1 earnings report on April 19, investors will likely be closely monitoring its financial results.
Is Tesla Stock a Buy, Sell, or Hold?
Wall Street is cautiously optimistic about Tesla, with a Moderate Buy consensus rating based on 19 Buys, 10 Holds, and three Sells. The average price target of $219.57 suggests upside of 18.7%.
