Tesla’s New EVs Face China’s Budget-Friendly Rivals

Tesla is rolling out two electric cars in China, the Model 3 Plus and the Model YL, in an effort to regain some power in the global automotive industry.

Specifically, Tesla now appears to be competing against an increasingly competitive field of electric vehicle (EV) competitors in Asia, including companies such as BYD and Xiaomi.

However, with Chinese rivals undercutting prices and rapidly expanding their production, Elon Musk and his American-based car company may find the road ahead steeper than ever.

The new Model 3 Plus, Tesla’s latest sedan, carries a higher-capacity LG-supplied battery and promises longer range than any current Model 3 sold in China, although official statistics have not yet been released to the public. Licensing details for the new vehicle configurations were first announced by CarNewsChina. It seems that Musk hopes these new models and their modern amenities will be the breakthrough to regaining some market power in Asia.

The Model YL SUV, a larger version of the existing Model Y, features a true third row, six seats, and dual motors offering 456 horsepower. The new YL, according to a report from Elektek, was rolled out to compete with other progressive, family-sized Chinese EVs, such as the NIO Onvo L90.

These new car configurations from Musk and company follow a somewhat lackluster response to Tesla’s previously released “Juniper” (considered to be another Model Y refresh), and come after the company reported a 14% global drop in vehicle deliveries last quarter, per TheVerge.

That’s no small concern, especially in China, easily the world’s largest EV market, where the battle is now as much about affordability as it is about innovation.

With the new Model YL expected to start at a price north of $50,000, Tesla’s premium pricing could potentially be a liability in a market where, in communist China, $39,000 buys a locally made competitor with similar features.

Regardless, Musk seems confident about his car company’s future.

On July 13, the Tesla founder posted to X, simply saying, “Just left the Tesla design studio. Most epic demo ever by end of year. Ever.”