In an effort to stave off competition from domestic rivals, the American electric vehicle company on Friday unveiled an updated version of its well-liked Model Y in China.
Delivery of the Model Y is scheduled to commence in March, with a starting price of 263,500 Chinese yuan ($35,935). That represents a 5.4% increase over the previous Model Y’s starting price.
According to a Tesla China representative, the new Model Y will not be released worldwide; it is only available for pre-sale in the Chinese market.
Tesla’s Model Y update follows the automaker’s announcement this month of its first-ever yearly drop in 2024 total deliveries.
Startups and established European automakers are posing a serious threat to Elon Musk’s electric vehicle company globally. The business still has to contend with a flurry of competitors in China, ranging from BYD to more recent entrants like Xpeng and Nio.
According to Jason Low, chief analyst at Canalys, the Tesla Model Y “remains high in popularity” and was the best-selling EV in China in 2024. He did point out that there has been “intense competition” in the sports utility vehicle (SUV) market, with cars ranging in price from 250,000 to 350,000 yuan.
To maintain its competitiveness in the market, Low continued, “Tesla must demonstrate compelling smart features, especially a unique but well localized cockpit and services ecosystem,” in addition to “effective” semi-autonomous driving assistance functions.
A five-year financing plan with zero percent interest is one of the many incentives Tesla is providing to customers who purchase the Model Y.
According to Tesla, the new Model Y can accelerate from 0 to 100 kilometers per hour in 4.3 seconds, which is faster than the previous model. Compared to its predecessor, the Model Y Long Range can travel farther between charges.
Since it started shipping the Cybertruck in late 2023, which starts at about $80,000, Tesla has not released a new model.
To boost sales, investors have been hankering after a new mass-market model. In the first half of 2025, Tesla has previously alluded to the possibility of releasing a new, more inexpensive model.
Due in part to CEO Musk’s tight relationship with U.S. President-elect Donald Trump, Tesla’s stock has increased by almost 70% over the past 12 months despite the company’s challenges.
