Feb 18, 2021 09:42 PM EST
Tesla (TSLA) has decided to cut the price of its base variants of the Model 3 sedan and Model Y sports utility vehicles. Interested buyers can now purchase the hot models for $1000 and $2000 cheaper, respectively.
The Model 3 Standard Range Plus is now down to $36,990, while a Model Y Standard Range is priced at $39,990, as reported by Investors.com.
Interested buyers of the performance variant of the two models, however, would not be too happy because both of them increased by $1000.
The Model 3 now costs $55,990, and Model Y rose to $60,990.
Tesla's price drops make monetary sense since it is facing greater competition down the road. Legacy automakers such as General Motors (GM), Ford (F), and Volkswagen (VWAGY) are already starting to look if they can penetrate the EV market.
In Japan, the reason for Tesla to cut prices is simpler. TThe base price of the standard version of a Model 3 was down to 29 million yen, which is about $40,500. The long-range version now goes for 4.99 million yen or $47,200.
Tesla hopes the price cuts will boost sales in Japan. Tesla's sales in Japan have been quite problematic. It sold less than 2,000 cars last year.
The competition in Japan can be described as steeper than everywhere else. Nissan's (NSANY) Ariya electric crossover SUV is slated to hit the Japanese market later this year already.
While price drops are happening, shares have also dropped. The two can also be connected.
Shares fell 1.35% to 787.38 on the stock market on February 18, pulling back from its 21-day exponential moving average. Tesla stock is testing its 50-day moving average, based on data provided by the MarketSmith chart analysis.
A bounce from that key benchmark can trigger a follow-on buy area for the IBD Leaderboard stock. But investors might be better off being patient and waiting to see if TSLA stock can retake its 21-day line.
Tesla stock flashed various signals of a climax top already back in January. It means that the stock has already peaked and might already be due to a pullback any time soon.
The stock has an RS Rating of 96 and an EPS Rating of 74, respectively. Its relative strength line has been on the lower trend since.
Potential competitors, legacy automakers, have notable movements in their stocks too. GM fell 1.4%, Ford dipped 0.4%, Nissan dropped 4.1%, and Volkswagen rose 3.75%.
China-based EV makers also saw sharp declines. Nio (NIO) fell 5%, and Xpeng (XPEV) sank 5.2%.
The company is hoping the price cuts can certainly lead to more sales or more deliveries. In 2020, the company delivered a record 499,550 vehicles.
Tesla is expanding its Shanghai manufacturing facility massively and is likely to put up an R&D center there year-end. The company also remarkably has more expansion plans, regardless of how the pandemic has slowed global economies down. The EV giant is building plants outside Berlin and Austin, Texas, and looking to have an electric-car manufacturing unit in southern India.
Rustam Gilfanov is a famous IT businessman, a founder of a large IT company, and a partner of the LongeVC Fund.
Bitcoin and cryptocurrency in general guarantee some amazing profits if invested correctly.
In the currency trading business, many individuals make mistakes. Since most individuals join this profession with too much excitement, they forget about efficient strategies. Instead of controlling their investment and execution process, most individuals make poor choices for trading.
In today's digital world, more and more people are investing in cryptocurrencies. These digital tokens have exploded into popularity over the past few years, and have grown to the point that there are now nearly over 6,000 of them, according to Statista.
Generational wealth is a facet of wealth management that is often misunderstood. Labeled trust fund babies, rich kids, and lucky breaks, those who receive an inheritance from families are rare.
Social media has successfully made it to the mainstream consciousness of over half the global population. DataReportal's latest study shows that over 4.33 billion people worldwide are using some form of social networking site this year. That's why it's no wonder many tech companies are interested in investing or forming the next Facebook, Twitter, or YouTube to capture the hearts and minds of the general population.
Ease of access, freedom to choose in which to invest the money and lines of credit designed according to the needs of consumers, are some of the characteristics that have made consumer credit one of the most important financing products in the world’s market.
While researchers have suggested that individuals who base their self-worth on their financial success often feel lonely in everyday life, a newly published study by the University at Buffalo and Harvard Business School has taken initial steps to better understand why this link exists.