Tesla plans to increase the price for imported Model 3s in China, according to sources close to the matter. The price hike will start in January 2020. At the same time, the MIC Model 3’s price is expected to drop thanks to government incentives. As such, Tesla seems set to make a killing in China come 2020.
According to Reuters, Tesla will increase the price for the top-tier variants of its imported Model 3 sedan in China. Currently, the Long Range AWD variant costs CN¥439,900 or an estimated US$62,495.56, and the Performance Model 3 is priced at CN¥ 509,900 or about US$72,522.72.
Credit: Tesla China/Twitter
The raised prices of Tesla’s imported top-tier Model 3 sedans will put it in stark contrast to the Made-in-China variant from Gigafactory 3 in Shanghai. Tesla China announced the MIC Model 3 will cost CN¥355,800 or about US$50,800 in a teaser released in late October.
The price quoted in Tesla China's teaser was for the entry-level Standard Range Plus variant. Autopilot comes standard with MIC Model 3 and is covered in its listed purchase price. The cost of Tesla’s locally-made all-electric sedan will be reduced by government incentives as well.
The MIC Model 3 recently qualified for government incentives that are expected to come into effect in late December. Tesla enthusiast Kelvin Yang shared a rumor that the Model 3’s price could decrease by about CN¥24,750, or US$3,500. If these numbers are correct, the Made-in-China Model 3 Standard Range Plus with Autopilot could cost about CN¥331,050, or US$47,300.
“Keep rollin' rollin' rollin' rollin' Keep rollin' rollin' rollin' rollin' Keep rollin' rollin' rollin' rollin” pic.twitter.com/AyFi7zDc6U— Jay in Shanghai 🇨🇳 (@JayinShanghai) December 11, 2019
Gigafactory 3 is already transporting MIC Model 3s to delivery centers across China. Reuters forecasted that deliveries could happen before January 25 next year, which fits perfectly with the timeline Tesla China set in its first teaser. Morgan Stanley analyst Adam Jonas believes Tesla’s gross margins for Gigafactory 3 could be in the low-to-mid 30 percent range.
Gigafactory 3 and Tesla’s potential sales in China have been good for the company, and analysts, like Morgan Stanley’s Adam Jonas, have been quoting higher price targets for Tesla shares. The all-electric car maker's potential sales from the Shanghai factory are the main reason analysts have become optimistic about Tesla. As a result, Gigafactory 3 and the MIC Model 3 could set the stage for the automaker in 2020.
Featured Image Credit: Tesla China/Twitter