Tesla's upgraded Model 3 offers extended range for Chinese drivers

author: FutureCar Staff    

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

At the same time, Tesla has reduced the prices of its premium Model S and Model X by approximately 14% to 21% in China and the U.S., its two largest markets. By raising the base price on the Model 3, Tesla aims to protect margins. However, the price cuts for its higher-end models highlight the ongoing pressure faced by electric vehicle (EV) makers, particularly in China where Tesla ignited a price war with domestic rivals, including BYD.

The new Model 3 represents Tesla's first update to its mass-market car lineup since the launch of its popular Model Y in 2020. While a launch date for the new Model 3 in the U.S. market has not been announced, Tesla currently offers discounts of over $5,000 on certain vehicles in inventory. The Model 3 is also manufactured in Fremont, California.

Tesla plans to debut the latest Model 3 at a trade fair in Beijing, showcasing new features tailored to Chinese car buyers. These features include a rear display for back-seat passengers, a better acoustic system, a more comfortable interior, additional airbags, and small exterior changes that give the sedan a sleeker front and new headlights.

The new Model 3 also boasts a longer driving range, with the standard version offering 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 and will begin deliveries in China in the fourth quarter. Orders are also being accepted in other export markets from Shanghai, such as Germany, Japan, Malaysia, Australia, and New Zealand.

While the new Model 3 is expected to perform well outside of China due to less competition in the EV market, industry experts anticipate challenges within China, where numerous new models with similar or better features and lower prices have been introduced since the Shanghai auto show in April.

Reuters reported last November that Tesla was developing a revamped Model 3 under the project codename "Highland." The project aimed to reduce production costs and enhance the model's appeal. Although Tesla did not provide specific details about the new Model 3's battery, sources familiar with the features revealed that it uses the same lithium-iron-phosphate battery from CATL for the base model. The increased driving range is achieved by reducing weight and improving the car's profile 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 plans to showcase the new model at the Munich auto show, potentially stealing attention from 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 scheduled to begin in late October.

($1 = 7.2582 Chinese yuan, $1 = 0.9211 euros)

FutureCar Staff