Chinese customers who take delivery of already-produced vehicles of the Model 3 and Model Y by the end of March can get benefits including an insurance subsidy of RMB 8,000.
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Tesla (NASDAQ: TSLA) has started offering benefits including insurance subsidies in China, fueling an already fierce price competition in the electric vehicle (EV) sector.
Chinese customers who take delivery of a Model 3 or Model Y before the end of March will receive up to RMB 34,600 yuan ($4,810) in benefits, Tesla announced today on Weibo.
It's worth noting that these offers are limited to Model 3s and Model Ys that have already been produced, not vehicles that are customized to customer demand before production.
Tesla has a factory in Shanghai that produces the Model 3 and Model Y. After the last price cut on January 12, the Model 3 now starts at RMB 245,900 and the Model Y at RMB 258,900 in China.
Tesla said today that Chinese customers who take delivery on or before March 31 will be eligible for an insurance subsidy of RMB 8,000, bringing the actual starting prices of the Model 3 and Model Y down to RMB 237,900 and RMB 250,900, respectively.
In addition to the insurance subsidy, customers who purchase and pick up a Model 3 or Model Y that has already been produced on or before March 31 will also be able to get select body paint for RMB 2,000, a savings of up to RMB 10,000.
Customers who purchase these models will also be able to take advantage of annual loan rates as low as 1.99 percent, which translates to an annualized interest rate starting at 3.65 percent.
Notably, Tesla announced on January 1 that it had begun offering an insurance subsidy of RMB 6,000 for Model 3 inventory cars. The subsidy -- which was not available for the Model Y at the time -- was only valid in January.
On January 12, Tesla cut the prices of all two versions of the Model 3 by as much as nearly 6 percent. Two of the three versions of the Model Y saw their prices cut by as much as nearly 3 percent.
Tesla's latest move comes at a time of heightened price competition in China's EV market.
On February 19, BYD (HKG: 1211, OTCMKTS: BYDDY) launched the Qin Plus Glory Edition and the Chaser 05 Glory Edition, lowering the starting price for both to RMB 79,800, kicking off a new price war in China's EV market after the Chinese New Year holiday. The two models were previously priced at RMB 99,800 and RMB 101,800, respectively.
On February 28, BYD launched updated versions of the Han and Tang, two flagship models of its Dynasty lineup, taking the price war further into the mid- to high-end EV market.
In addition to these models, BYD also lowered the prices of the Dolphin, Song Plus, and Seal DM-i in this round of model updates.
BYD continues model update with refreshed Song Plus, Seal DM-i
($1 = RMB 7.1887)
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