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Tesla announces price cuts after reporting declining sales of EV vehicles 

Tesla has once again reduced prices in several key markets as it deals with declining sales. In China, the starting price of the revamped Model 3 was slashed by 14,000 yuan to 231,900 yuan. 

Similarly, prices for the Model Y, Model X and Model S in the US were lowered by $2,000 on Friday. Reuters reports that there were also price cuts in a number of countries across Europe, the Middle East, and Africa.

This move follows a drop in global vehicle deliveries during the first three months of the year. The electric vehicle (EV) market has seen intensifying competition, particularly from Chinese manufacturers. Tesla is scheduled to announce its financial results for the first quarter of 2024 after the US market closes on Tuesday.

Elon Musk, Tesla’s CEO, stated on the social media platform X that Tesla adjusts prices frequently to align production with demand. The company initiated an EV price war over a year ago by aggressively reducing prices, albeit at the expense of profit margins. 

While competitors in China, such as BYD and Nio, have introduced more affordable models, Tesla has been slow in updating its older models.

Last week, Tesla revealed plans to cut over 10% of its global workforce. Additionally, Musk postponed his trip to India, where he was slated to meet with Prime Minister Narendra Modi, due to “very heavy Tesla obligations.” 

Additionally, Tesla recently issued a recall for thousands of its new Cybertrucks due to safety concerns. One issue raised was related to the accelerator pedals, which risk becoming trapped by the interior trim, potentially leading to accidents. 

Another recent issue was the self-drive feature, which has had a lot of criticism over the safety risks. Nearly 363,000 cars were recalled recently due to an issue with the advanced driver assistance feature, known as “Full Self-Driving Beta”, which came after a report of a crash in California involving a Tesla vehicle.

Overall, Tesla’s shares have experienced a decline of over 40% since the beginning of the year.

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