After temporarily closing the order books for the Model S and Model X in Australia, Tesla Inc has now paused the orders for the two models in Asian Pacific nations of Thailand, Singapore and New Zealand
Recently, Tesla Inc paused taking orders for the Model S and Model X on its Australian website. Following this development, the California-based carmaker has now stopped taking orders even in other Asia Pacific nations. As reported by Reuters, effective Sunday, Tesla websites in New Zealand, Singapore and Thailand have stopped taking orders for the Model S and Model X. Meanwhile, the order book for Model 3 and the Model Y stays unaffected.
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Demand for Tesla Model S and Model X Frizzles Out in APAC Region
It may be noted here that the Tesla Model S and Model X are flagship offerings that were facelifted in 2021. Thanks to the high pricing, the demand for these cars isn’t as high as that for the Model 3 and Model Y. The Model S and Model X are produced at the carmaker’s Fremont facility and are shipped to APAC markets. This not just adds to the cost but even results into higher delivery times.
As reported in the first quarter results, Tesla witnessed a pretty big 38% drop in the deliveries of Model S and Model X. Yet, it managed to post an unprecedented delivery number due to the high demand for Model 3 and Model Y. The entry-level models were particularly in huge demand in California, Texas, China and Germany. However, demand for the costlier cars were seen frizzling out, especially in the APAC regions. This, in spite of the multiple price cuts that have come into effect since the beginning of the year.
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Musk Confident of Pricing Strategy
“Tesla is in a uniquely strong strategic position. Because we’re the only ones making cars that, technically, we could sell for zero profit for now and then yield actually tremendous economics in the future through autonomy, no one else can do that. I’m not sure how many people will appreciate the profundity of what I’ve just said, but it is extremely significant,” Musk said. The multiple price cuts has led to thinning of the industry-leading margins the renowned electric car manufacturer has been known for. While CEO Elon Musk would hopes the reduced prices would help Tesla sail through troubled waters, the sales slump and resultantly falling share price suggest otherwise.
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