In order to boost sales, Tesla Inc. has started a new global reward program that gives buyers more benefits if they get recommendations from other customers. This is a common way that standard companies try to boost sales. The cash refunds can be used in several countries, including the United States, China, Canada, and Germany, according to Tesla's regional websites.
Tesla's "Refer and Earn" Program: Discounts and Incentives for New Buyers in the U.S.
On Tesla's website, the reward is called "Refer and Earn." It gives new buyers in the U.S. a return of about $500 and three months of Full Self-Driving when they buy a Model 3 or Model Y. Starting July 7, people in the U.K. who buy a Model S or Model X through a recommendation will get a £1,000 discount. For Model 3 and Model Y, the discount is £500.
Tesla's Price War in China: Cash Bonuses and Enhanced Autopilot Offerings
In China, Tesla has taken the price war to a new level by giving new buyers of its famous electric cars who get a referral from a current owner a cash bonus of almost $500. Also, new buyers in China will be able to use Tesla's Enhanced Autopilot driver aid system for free for 90 days after they buy a car.
Since the beginning of the year, Tesla has been in a price war in China's EV market, cutting the base price of the Model 3 car by 14% and the Model Y by 10%. This change was made because of a weak economy, higher materials costs, and more competition from traditional automakers. CEO Elon Musk put more emphasis on sales growth than on making money.
Signs of an Industry Shift: Tesla's Refunds and the Promise to Avoid Abnormal Pricing
The latest refund from Tesla was announced at the same time that it and 15 other companies signed a promise from the China Association of Automobile Manufacturers to raise prices and avoid "abnormal pricing." Some have seen this as a sign that the price war that had been hurting the industry as a whole might be coming to an end.
The news of the cash refunds was posted on Tesla's Weibo account. In June, the company gave refunds of 7,000 yuan to people in China who bought the more expensive Model S and Model X.
Many Tesla users have already put their referral codes online, making it possible for existing customers and a wider range of new buyers to get a cash refund.
Stock Surge and Investor Confidence: Tesla's Sales Strategy Paying Off
In the second quarter, Tesla broke its own sales record by selling 247,217 cars made in China. This was the biggest number since deliveries from its Shanghai plant started in early 2020. During that time, more than half of the EVs Tesla sold around the world were made in China.
Since early May, the company's stock has gone up by almost 70%. This is because investors liked the signs of more sales coming from price cuts around the world and government benefits in the United States. People think that Tesla will be able to keep its profit margins stable over strategy long time.
Early this year, price cuts by Tesla and its rivals helped boost sales in China, but the rate of growth has slowed in recent months. Because of this, local governments have added more benefits and extra incentives for buyers, such as tax breaks for buying EVs.
In Japan, Tesla just cut the prices of the Model 3 and Model Y by 3–4% this week.