Tesla Motors Inc (TSLA) Model S Demand Weak In Europe?


Tesla Motors Inc (NASDAQ:TSLA) Model S prices have been lowered in Germany and the Netherlands for reasons unknown. Many are expecting that low sales in the region are responsible for the price cuts, says a report from Cleantechnica. As reported by Inside EVs, a couple of weeks back, the official reason given by Tesla for the price cuts is the appreciation of the currency against the US dollar as Tesla follows a policy of “fairi pricing in all international markets.”

Demand strong in Norway, weak in Germany

In Norway, the sales has been impressive, but in Germany the sales are slow with less than 100 units sold in the first two months, says a report from Inside EVs. There is no official confirmation yet on the slashed prices, but the online sources show a fairly substantial drop in the price.

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For example, in Germany, the price of a Tesla Motors Inc (NASDAQ:TSLA) vehicle has dropped by around 7000 euros (approximately $9,700) to 65,300 euros ($90,600). In Holland, the price is down 4,000 ($5,500) euros to 66,200 ($91,900). In the U.S. there have been no change in the price of Tesla’s Model S, which starts at $69,900 before incentives.

Price cuts in contrast to Tesla CEO comments

In is interesting to note that price cuts are in stark contrast to the prediction given by Tesla Motors Inc (NASDAQ:TSLA) CEO Elon Musk a month ago. Musk, at that time, said that the company expects to sell about twice as many cars in China and Europe than North America by the end of the year. The CEO also emphasized boosting the logistics for sales to China and Europe in the second half of the year.

“Towards the end of the year, we expect sales in those regions combined to be almost twice that of North America,” Elon said.

In 2013, Tesla Motors Inc (NASDAQ:TSLA) sold 22,477 cars with the majority of the vehicles flowing to the U.S. market as the sales in Europe started only in the Fall. In China, Tesla is going much against the expectations by pricing the car reasonably. The price in China is similar to that of U.S., and is higher only due to unavoidable costs like shipping costs, duties, and taxes.