Tesla has announced it would lower prices for its Model 3 electric cars manufactured in Shanghai from 356,000 yuan （$51,000）to 324,000 yuan ($46,000), a move expected to create a catfish effect in China's new energy vehicle market.
Deducting government subsidies on the new energy vehicles, a Tesla Model 3 car will sell for 299,000 yuan.
Liu Jiansen, an analyst at market research company Canalys, pointed out that pressure on Chinese new-energy car companies will increase after Tesla's price drop.
It took Tesla less than a year to complete factory construction, mass production and delivery in China, creating much pressure on local manufacturers.
Production and sale of new energy vehicles across China reached 110,000 and 95,000 respectively, down 36.9 percent and 43.7 percent year-on-year in November 2019, although it rose 3.6 percent and 1.3 percent in the first 11 months last year, according to China Association of Automobile Manufacturers data.
However, observers say rapid development of Tesla in China would accelerate the reshuffle of the new energy vehicle industry. Besides, technology used in the domestic new energy vehicle industry is expected to improve, further reducing NEV costs and accelerating the popularity of domestic new energy vehicles.