{"id":40852,"date":"2023-01-20T11:53:35","date_gmt":"2023-01-20T16:53:35","guid":{"rendered":"http:\/\/autosector.com\/?p=40852"},"modified":"2023-01-20T11:53:35","modified_gmt":"2023-01-20T16:53:35","slug":"tesla-started-ev-price-war-win","status":"publish","type":"post","link":"http:\/\/autosector.com\/?p=40852","title":{"rendered":"Tesla just started an EV price war that it will likely win"},"content":{"rendered":"
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Tesla has just started what could become a major EV price war, and it could change the landscape as the automaker is in a great position to win that war.<\/p>\n

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The number one thing I hear from people that are interested in buying an electric car is that the price is high.<\/p>\n

I always counter it by asking them how much they spend on gas and with those savings, the cost of ownership is often cheaper than a gasoline vehicle. However, a higher sticker price remains an important psychological barrier for many buyers even after considering the total cost of ownership.<\/p>\n

On top of that, the average price of electric vehicles has been steadily increasing over the last two years thanks to high demand, supply chain issues, and general inflation.<\/p>\n

But now things are starting to get interesting for the first time on the EV pricing front.<\/p>\n

Tesla has implemented some significant price cuts across its entire lineup<\/a> and in all markets. It almost reversed the price increases over the last few years entirely.<\/p>\n

As we recently reported, the price drop has been working in the US<\/a> where it also arrives at the same time as the new $7,500 tax credit for electric vehicles.<\/p>\n

Tesla\u2019s sales are surging following the price drop and now we are seeing other automakers following in the price drop. For example, Xpeng saw its sales drop during the week following Tesla\u2019s price drop, and the company has now implemented important price drops, too<\/a>.<\/p>\n

Many experts are seeing this as the first few steps into the first ever EV price war.<\/p>\n

Tesla is in a perfect position to win the EV price war<\/h2>\n

In a price war, it\u2019s all about your ability to absorb price reductions and on that front, you can\u2019t deny Tesla\u2019s lead.<\/p>\n

For years now, the automaker has been enjoying industry-leading gross margins and net profits.<\/p>\n

Here, Reuters<\/em> put a chart together showing how Tesla\u2019s gross margin and net profit compare to rivals in the auto industry:<\/p>\n

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That chart is impressive, but it doesn\u2019t even tell the whole story.<\/p>\n

Aside from companies like Nio and Xpeng, all the gross margins and net profits from the other companies also come from non-all-electric vehicles \u2013 meaning hybrids, PHEVs and gas-powered cars.<\/p>\n

For companies like GM, which comes in second to Tesla in net profits, it is believed that its gasoline-powered vehicles have much higher margins than its electric vehicles.<\/p>\n

Electrek\u2019s Take<\/h2>\n

I\u2019ve always said that I believe some big companies will fall during the electric revolution. I\u2019m not saying that\u2019s happening now, but if an EV price war heats up, I think we could see it happen.<\/p>\n

I think Tesla still has a few wild cards that are questionable \u2013 Elon Musk is at the top of that list \u2013 but it is definitely Tesla\u2019s war to lose.<\/p>\n

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FTC: We use income earning auto affiliate links.<\/em> More.<\/a><\/p>\n

<\/div>\n","protected":false},"excerpt":{"rendered":"

Tesla has just started what could become a major EV price war, and it could change the landscape as the automaker is in a great position to win that war. The number one thing I hear from people that are interested in buying an electric car is that the price is high. I always counter […]<\/p>\n","protected":false},"author":1,"featured_media":8313,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[4],"tags":[],"class_list":["post-40852","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-e-cars"],"_links":{"self":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts\/40852","targetHints":{"allow":["GET"]}}],"collection":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=40852"}],"version-history":[{"count":0,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/posts\/40852\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=\/wp\/v2\/media\/8313"}],"wp:attachment":[{"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=40852"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=40852"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/autosector.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=40852"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}