Musk Leaning Beijing? After Postponing Meeting With PM Modi, Tesla Slashes Prices In China

After the apparent postponement of Elon Musk's much talked about meeting with the Indian Prime Minister Modi, which raised a few eyebrows, another development has emerged in the matter.

According to reports, Musk's car company, Tesla has slashed prices for its high-end cars in China.

The Meeting That Did Not Happen

For context, Tesla, given the conundrum, that it is in, has laid significant emphasis on diversifying and finding and consolidating new markets. A part of the strategy involved the consideration of establishing a manufacturing unit in India.

The process of Tesla's expansion in India and beyond were further fostered, after the Indian government brought about some pivotal policy changes, which made it conducive for electric vehicle makers to invest in India. Before the policy came into being, Tesla had hinted at some kind of special concession for the American car maker.

The Indian government in some regards disagreed with the 'expectations'. Union Minister Piyush Goel, even went on to say, that India will not tailor policy for Tesla'.

The postponement or cancellation of the much anticipated meeting between Musk and Modi, was attributed to some 'Tesla oriented commitments' that Musk had to fulfill.

Tesla Slashes Prices

Amidst all this, one the largest market for everything in the world, including EVs, China received a gift from Tesla, as the wagon maker slashed the prices of the its vehicles in the country. Here, the Model 3, saw its price reduced from Rs 28,91,506 (appx.) to Rs 27,16,298 (appx.). In addition, its Model Y also saw a drop in price, as to it was brought down to Rs 29,38,541 (appx.) from the previous Rs 31,03,165 (appx.).

This could also be seen as measure or way to counter BYD, Tesla's chief rival in its own backyard. Price war has eventually become a part and parcel of the EV industry, this as it spent years insulated from any competition, because of its status as a luxury good.

This, also comes at the back of similar reduction of prices in the US, where Tesla's Model Y, Model X and Model S all saw a drop in their prices.

The market is getting bigger, and the competition is getting stiffer, Tesla would look to expand further, and it cannot afford to lose either India or China, given the immense potential of these markets, that collectively amount for a GDP of close to USD 20 trillion. Caution would be path of sustained growth for the company.