Tesla struggles to sell a third of its initial Model Y models it imported last year, offers discounts: Report

Tesla is reportedly struggling to sell around a third of the initial Model Y vehicles it imported last year in India. Despite expectations of strong demand, about 100 cars from the original batch of 300 remain unsold several months after their arrival, a report said. 

According to a report in Bloomberg, the shortfall in deliveries is the result of early buyers withdrawing bookings as well as tepid market interest in the brand’s entry-level offering. A wave of cancellations has contributed notably to the current inventory build-up, underlining the uncertain reception Tesla has encountered in India’s luxury EV segment.

In response to sluggish sales, Tesla has initiated targeted discounts of up to Rs 2,00,000 ($2,200) on select Model Y variants, aiming to entice remaining potential buyers and accelerate stock clearance, the report added. These offers are directed at customers and test-drive seekers specifically, rather than being part of a broad, countrywide campaign.

While the Model Y begins at nearly $70,000 in India, its price point places it directly against established luxury brands. However, the company has encountered a gap between initial booking numbers and actual sales, as a significant portion of those orders have yet to be converted into deliveries.

Many buyers who initially placed deposits are now reluctant to complete purchases of the lower-priced and shorter-range Model Y. There has also been a slower uptake for more costly, longer-range variants, compounding Tesla’s inventory management challenges.

The situation contrasts with other luxury EV makers, such as BMW and BYD, who have reported considerable growth in India. BMW AG’s Indian unit saw sales jump almost 200 per cent last year to around 3,700 vehicles due to the locally assembled iX1 model.