Tesla Slaps $121K Price Tag on Model S Sedan in China Why the …

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TESLA Model S – 60 kWh Auto

Tesla Slaps $121K Price Tag on Model S Sedan in China: Why the Price Hike Isn t All That Bad

A Tesla Model S electric sedan is driven near the company’s factory in Fremont, California, June 22, 2012. Tesla has announced its pricing strategy for China, which includes a $121,000 price tag for the Model S sedan. (Photo. REUTERS/Noah Berger)

Tesla Motors has unveiled a risky pricing strategy for China, the company announced Thursday.

The Palo Alto, Calif.-based company will offer its all-electric battery Model S sedan for 734,000 yuan, or US$121,300, in China after shipping costs and import duty and other taxes. The Model S, which features an 85 kilowatt-hour battery pack, carries an $81,070 price tag in the U.S.

While the jump in price for the Model S in China might seem like a steep increase, Tesla’s competitive pricing isn’t as bad as it looks. Chinese state media have recently called out global luxury automakers for hiking its prices up in China, where some vehicles sells for two to three times more than they do in the U.S. and Europe, Reuters reports.

This pricing structure is something of a risk for Tesla, Tesla said in a statement. If we were to follow standard industry practice, we could get away with charging twice as much for the Model S in China as we do in the U.S.

We know that our competitors will try to convince Chinese consumers that our relatively lower price tag means the Model S is a lesser car, when the real reason their car costs more is that they make double the profit per car in China compared to the United States or Europe. Tesla said.

Telsa began accepting reservations for the Model S and the upcoming Model X in China last August. The company has also opened a store in Beijing.

Tesla recently recalled 29,000 chargers due to overheating concerns with the adapters.

Tesla will send owners replacement adapters via mail along with a software update to fix the issue, which includes melted adapters and, in a worst-case scenario, fire, the company said in a letter to the National Highway Traffic Safety Administration on January 12. The adapters will be provided to existing and new Tesla owners starting in a few weeks, Tesla said.

The new home chargers include thermal fuses designed to shut down the charger when abnormal levels of heat are detected. The wall adapter concern is the latest issue Tesla is dealing with involving fires and its electric cars. It is also the subject of a separate federal probe into fires started in Tesla Model S vehicles after the cars’ battery packs were punctured by road debris.


Despite the recent issues, Tesla stock is rising, according to the company’s fourth quarter sales figures. Tesla has also earned top marks in government crash tests, including what the company boasts were the highest crash test marks of any car ever tested.

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