Considering that many other automakers are also raising prices, the team does not expect any structural impact on future demand.

(Image credit: CnEVPost)

Motors (NYSE: XPEV, HKG: 9868) confirmed earlier today previous media reports of impending price increases for its models, and Deutsche Bank analyst Edison Yu's team offered their take on it.

The move will help offset rising raw material costs, especially related to batteries, the team said, adding that they don't expect any structural impact on future demand, given that many other automakers are also raising prices.

XPeng's order book has remained strong despite the recent Covid lockdowns. Delivery logistics have been restricted in Shenzhen so that will impact March volumes but the Shanghai headwind should be fairly minimal, the team said.

Unlike the US and Europe, most Chinese EV makers didn't raise pricing last year because battery suppliers absorbed most of the higher prices, the team noted.

However, that is rapidly changing as some automakers have now announced price increases, including , , , Great Wall Motor's brand and Chery, the team said.

Yu's team also noted that Tesla raised the price of its standard-range models in China once this month and raised the price of its long-range and performance versions twice.

Earlier today, XPeng announced that it will raise the pre-subsidy prices of its models by RMB 10,100 to RMB 20,000 ($3,140), which will go into effect at 0:00 on March 21 and will not affect those who pay a deposit before then.

CnEVPost notes that while rising raw material prices and a reduction in Chinese subsidies for new energy vehicles have put pressure on XPeng to raise prices, Tesla's actions may have been one of the key reasons that allowed it to raise prices significantly.

Tesla raised the prices of the entry-level Model 3 and Model Y in China by 10,000 yuan and 21,088 yuan, respectively, on December 31 last year.

In the past week, Tesla made three price increases, bringing the price of the entry-level Model 3 to RMB 279,900, up RMB 29,000 from RMB 250,900 at the beginning of November last year.

The price of the entry-level Model Y now stands at RMB 316,900, up RMB 40,900 from RMB 276,000 at the beginning of November last year.

For comparison, XPeng only raised the price of its models priced below RMB 300,000 by RMB 4,300-5,900 on January 11.

Tesla's actions this month have further widened the price gap between it and XPeng models, thus providing the latter with a lot of room for price increases.

Tesla China price changes

DateModelPrev PriceChange (RMB)%Latest Price
May 5, 2023Model S789,90019,0002.41%808,900
May 5, 2023Model S Plaid1,009,90019,0001.88%1,028,900
May 5, 2023Model X879,90019,0002.16%898,900
May 5, 2023Model X Plaid1,039,90019,0001.83%1,058,900
May 2, 2023Model 3229,900+2,0000.87%231,900
May 2, 2023Model 3 Performance329,900+2,0000.61%331,900
May 2, 2023Model Y261,900+2,0000.76%263,900
May 2, 2023Model Y Long Range311,900+2,0000.64%313,900
May 2, 2023Model Y Performance361,900+2,0000.55%363,900
Feb 17, 2023Model Y Performance359,900+2,0000.56%361,900
Feb 17, 2023Model Y Long Range309,900+2,0000.65%311,900
Feb 10, 2023Model Y259,900+2,0000.77%261,900
Jan 6, 2023Model X PlaidNewNANA1,039,900
Jan 6, 2023Model XNewNANA879,900
Jan 6, 2023Model S PlaidNewNANA1,009,900
Jan 6, 2023Model SNewNANA789,900
Jan 6, 2023Model Y Performance397,900-38,000-9.55%359,900
Jan 6, 2023Model Y Long Range357,900-48,000-13.41%309,900
Jan 6, 2023Model Y288,900-29,000-10.04%259,900
Jan 6, 2023Model 3 Performance349,900-20,000-5.72%329,900
Jan 6, 2023Model 3265,900-36,000-13.54%229,900
Oct 24, 2022Model Y Performance417,900-20,000-4.79%397,900
Oct 24, 2022Model Y Long Range394,900-37,000-9.37%357,900
Oct 24, 2022Model Y316,900-28,000-8.84%288,900
Oct 24, 2022Model 3 Performance367,900-18,000-4.89%349,900
Oct 24, 2022Model 3279,900-14,000-5.00%265,900
June 17, 2022Model Y Long Range375,900+19,0005.05%394,900
Mar 17, 2022Model Y301,840+15,0604.99%316,900
Mar 15, 2022Model Y Performance397,900+20,0005.03%417,900
Mar 15, 2022Model Y Long Range357,900+18,0005.03%375,900
Mar 15, 2022Model 3 Performance349,900+18,0005.14%367,900
Mar 15, 2022Model 3265,652+14,2485.36%279,900
Mar 10, 2022Model Y Performance387,900+10,0002.58%397,900
Mar 10, 2022Model Y Long Range347,900+10,0002.87%357,900
Mar 10, 2022Model 3 Performance339,900+10,0002.94%349,900
Dec 31, 2021Model Y280,752+21,0887.51%301,840
Dec 31, 2021Model 3255,652+10,0003.91%265,652
Nov 24, 2021Model Y276,000+4,7521.72%280,752
Nov 24, 2021Model 3250,900+4,7521.89%255,652
Nov 19, 2021Model 3235,900+15,0006.36%250,900
Oct 27, 2021Model S Long Range859,990+30,0003.49%889,990
Oct 27, 2021Model X Long Range909,990+30,0003.30%939,990
Sept 11, 2021Model Y Performance377,900+10,0002.65%387,900
Aug 4, 2021Model S Long Range829,990+30,0003.61%859,990
Aug 4, 2021Model X Long Range879,990+30,0003.41%909,990
Jul 30, 2021Model 3250,900-15,000-5.98%235,900
Jul 16, 2021Model S Long Range799,990+30,0003.75%829,990
Jul 16, 2021Model X Long Range849,990+30,0003.53%879,990
Jul 8, 2021Model YNANewNA276,000
May 8, 2021Model 3249,900+1,0000.40%250,900
Mar 24, 2021Model Y Long Range339,900+8,0002.35%347,900
Mar 24, 2021Model Y Performance369,900+8,0002.16%377,900
Jan 1, 2021Model Y Long RangeNewNANA339,900
Jan 1, 2021Model Y PerformanceNewNANA369,900
Jan 1, 2021Model 3 PerformanceNewNANA339,900
Oct 1, 2020Model 3271,600-21,700-7.99%249,900
Oct 1, 2020Model 3 Long Range344,050-34,150-9.93%309,900