Tesla's updated Model 3 offers extended range for Chinese drivers.

author: FutureCar Staff    

Tesla has unveiled a restyled Model 3 made in China, which boasts a longer driving range. This marks the first time the automaker has launched a new model in China before the United States. The new model is being manufactured at Tesla's Shanghai plant and comes with a starting price that is 12% higher than the previous base model in China. Additionally, it will be exported to other markets in Asia, Europe, and the Middle East.

Simultaneously, Tesla has reduced the prices of its premium Model S and Model X by approximately 14% to 21% in China and the United States, its two largest markets. While raising the base price on the Model 3 could protect margins, the price cuts for the higher-end models highlight the ongoing pressure faced by electric vehicle (EV) manufacturers, particularly in China where Tesla initiated a price war with Chinese competitors earlier this year, including industry leader BYD.

The new Model 3 is Tesla's first update to its mass-market car lineup since the launch of the Model Y in 2020, which has become a global best-seller. Although Tesla did not announce a launch date for the new Model 3 in the U.S., the company currently offers discounts of over $5,000 on some inventory vehicles in the American market. The Model 3 is also assembled in Fremont, California.

Tesla plans to debut the latest Model 3 at a trade fair in Beijing, showcasing new features specifically aimed at Chinese car buyers. These features include a rear display for back-seat passengers, improved acoustic systems, a more comfortable interior, and additional airbags. The exterior of the sedan also underwent minor changes, resulting in a sleeker front and new headlights.

The new Model 3 boasts a longer driving range, with the standard version having a range of 606 km (377 miles) based on China's testing standards. This represents a 9% increase compared to the base model it replaces in China. Tesla has already started taking orders for the new Model 3 and plans to begin deliveries in China in the fourth quarter. Orders are also being accepted in other markets where Tesla exports from Shanghai, including Germany, Japan, Malaysia, Australia, and New Zealand.

According to Yale Zhang, managing director at Shanghai-based consultancy Automotive Foresight, the new Model 3 is expected to perform well outside of China due to less competition in the EV market. However, in China, there have been numerous new models released since the Shanghai auto show in April, featuring similar or even better features at lower prices.

Previously known as "Highland," Tesla's revamped Model 3 was developed with the aim of reducing production costs and increasing the model's appeal. Although Tesla did not provide specific details about the new Model 3's battery, it is reported to be the same lithium-iron-phosphate battery from CATL used in the base model. The improved driving range is a result of weight reduction and improved aerodynamics to minimize wind resistance.

In China, the Model 3 faces competition from BYD's Seal, Geely's Zeekr 001, Nio's ET5, and Xpeng's P7i. Xpeng recently announced zero-interest loans and free upgrades for its car. Tesla also plans to showcase the new Model 3 at the Munich auto show, potentially overshadowing German automakers like Volkswagen and Mercedes, who are expected to announce a range of new EVs in response to China's rapidly evolving market.

The new Model 3 starts at 259,900 yuan ($35,807) in China and 42,990 euros ($46,670) in Germany. Deliveries in Europe are set to begin in late October.

(1 Chinese yuan equals $7.2582, 1 euro equals $0.9211)

FutureCar Staff