| 29 May 2024, Wednesday |

Elon Musk increases Tesla price in US and China on inflation concerns

Tesla raised pricing in China and the United States on Tuesday, marking the company’s second price hike in less than a week, after CEO Elon Musk claimed the electric carmaker was facing substantial inflation pressure.

Costs of raw resources are rising, exacerbated by a crisis over Russia’s military offensive in Ukraine.

On Sunday, Mr Musk stated that the electric vehicle manufacturer and rocket company Space X was under pressure in areas such as raw materials and logistics.

According to the company’s website, all of its models in the United States have been boosted in price. It boosted the pricing of some China-made Model 3 and Model Y automobiles by around 5% in China, just a few days after increasing them by 5% on March 10. Tesla has remained silent about the matter.

The Model Y Long Range vehicle now costs 375,900 yuan ($59,098) in China, up 18,000 yuan from March 10, when it was increased by 10,000 yuan.

After a hike of 18,000 yuan on Tuesday, the price of the Model 3 Performance unit was 367,900 yuan, up from 10,000 yuan five days before.

The price of metals used in automobiles has risen as a result of Russia’s military offensive in Ukraine, from aluminum in bodywork to palladium in catalytic converters to high-grade nickel in electric vehicle batteries, and drivers are expected to foot the tab.

While metals have yet to be sanctioned by the West, certain shipping companies and auto parts suppliers are avoiding Russian goods, adding to the pressure on automakers who are already dealing with a chip scarcity and rising energy prices.

Consumer inflation in the United States rose to its highest level in four decades, owing to rising housing, food, and petrol prices, bolstering the case for the Federal Reserve to raise interest rates.

Meanwhile, according to Gregory Miller, an analyst at industry forecaster Benchmark Mineral Intelligence, rising prices of nickel, lithium, and other materials are expected to slow and even reverse the long-term trend of falling costs of batteries, the most expensive part of EVs, impeding broader adoption of the technology.


  • The National News