Tesla stock price is down, deliveries missed expectations last quarter, and significant price drop — in China. Those are the major concerns swirling around the electric car manufacturer as investors took to Twitter to complain about the slash in prices overseas. However, there is a significant difference between the EV market in China compared to most other regions worldwide, especially North America.
Tesla dominates the market almost everywhere, except China. Unlike the dinosaurs in the North American automotive sector, Chinese car manufacturers have been developing and producing electric vehicles for a long time. While Tesla has had countries like the United States and Canada all to themselves for buyers wanting an electric vehicle, it’s not so easy in China. Telsa has to convince consumers to try something other than the BYD Song Plus or the Wuling Hongguang Mini EV.
Tesla has Competition in China
BYD started up in China in 2003, and by 2008 it was building the best-selling hybrid cars in the country. In 2009, several years after the carmaker achieved the top sales in the country. BYD was then converted to a fully electric vehicle, making it much easier for buyers to adapt to EVs while sticking with the brand they already trusted.
Then there is the horrendously ugly and ridiculously cheap Wuling Hongguang Mini EV. At a starting point of $4,500, anyone can hope no one sees them in this EV. The automaker hit the China market hard starting in 2020 and has not surpassed 500,000 deliveries.
Tesla’s main competitors have two particularly important advantages, BYD has brand loyalty, and Wuling Hongguang Mini EV is cheap. Therefore, it only makes sense that Tesla is aggressive. The Model 3 is now the cheapest it has ever been in China, and the Model Y has become much more affordable.
Tesla Cuts Prices
The company already dropped prices a few months ago, and now it's dropping them again. A RWD Model 3 is now $33,500 USD, when it was nearly $39,000; the same car in the United States goes for about $47,000. The RWD Model Y (not available in North America) is now $37,800 USD, down from about $42,000.
Following the announcement in China, Tesla has followed with reducing the prices in several other regions as well. The prices of the Model 3 and Model Y have been reduced in Australia, with price reductions in the 2-4% range, depending on the model.
In addition to China and Australia, Japan is also seeing the price of the Model Y reduced by up to 10%.
While these prices may be tough to swallow for someone in North America, consider that Tesla constantly changes prices to match what the market will pay. This practice has removed the slimy car salesman tactics that plagued the industry for decades. So, while it may seem unfair, Tesla owners must understand that the company doing well in all markets worldwide is vital to its survival as more competition emerges.
It's also possible that we'll see some price reductions in the U.S. as well. With the EV tax credit going into effect this January, Tesla aims to allow as many models to qualify as possible.
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Tesla has quietly launched a new monthly subscription service in the United States for windshield protection. This is separate from the recently announced Extended Service Agreement, an extended warranty that is paid for monthly.
This new plan specifically targets one of the most common and costly repairs: windshield damage, which is not covered by the extended warranty.
This new plan is a nice addition for users who prefer peace of mind, but it comes with some very specific and time-sensitive eligibility windows that all new owners should be aware of.
Coverage & Cost
For a flat monthly fee that varies by model, the Windshield Protection Plan provides comprehensive coverage for the front windshield, including the use of Tesla OEM glass and any required Autopilot camera calibrations.
The benefits include:
One free windshield replacement every 12-month period with no deductible
Any additional replacements incur a $100 co-pay per replacement
Unlimited chip and minor crack repairs
Tesla varies the pricing based on your vehicle:
Model 3 / Model Y: $12 per month
Model S: $15 per month
Model X: $23 per month
Who is Eligible and When?
This is the most crucial part to take away here.
You must enroll within 30 days of taking delivery of a new or used Tesla vehicle.
This is a very tight window, so new owners interested in the plan will need to subscribe pretty quickly. However, Tesla does offer alternative ways to get into the program.
Alternative Ways to Join
If you paid for a replacement windshield at Tesla, you also have 30 days to join the program. Likewise, if your vehicle passes a complimentary vehicle inspection, Tesla will also offer you the ability to join the program.
Although the complimentary inspection isn’t available yet, Tesla expects to begin offering the program sometime around July 2025. For now, the plan is only available in the US, similar to the new Extended Service Agreement Subscription. However, Tesla has announced plans to roll it out to other regions shortly, starting with Canada and Mexico.
No Cybertruck Coverage
Just as with the ESA, the Cybertruck is left out. The new Windshield Protection Plan isn’t being offered on the Cybertruck.
This exclusion is particularly important given the high cost of replacing a windshield for the Cybertruck. Out-of-pocket replacement costs exceed $2,300 USD. For now, Cybertruck owners will have to rely on their standard auto insurance for coverage.
How to Subscribe
Enrolling in the Extended Service Agreement or the Windshield Protection plan is handled directly within the Tesla App. If your vehicle is eligible, you’ll be able to navigate to Upgrades > Service Plans > Windshield Protection to review the terms and subscribe.
Once the complimentary inspection is available, you’ll be able to subscribe in person at a Tesla service center as well.
This new plan offers an affordable way for owners to hedge against one of the most common, frustrating, and expensive repair costs, and is expected to be a popular add-on.
Tesla has introduced a new, more flexible and affordable way for owners to get peace of mind after their factory warranty ends. This new service is a monthly subscription that replaces the previous Extended Service Agreement (ESA) in the United States.
The new subscription model makes it more appealing to owners, as it avoids a large upfront payment. This new subscription also offers better coverage terms than before.
Longer Coverage, Better Flexibility
The biggest upgrade in this new format of the ESA is the length of the coverage. The old prepaid ESA was limited to just two years or 25,000 miles beyond the factory warranty, for a total of up to 75,000 miles.
The new monthly program doubles the potential coverage period, offering protection for up to four additional years beyond the factory warranty, or until the vehicle reaches 100,000 miles, whichever comes first. Coming from a basic vehicle warranty of 4 years or 50,000 miles, this is a huge jump up in customer protection.
Pricing & Deductible
The monthly price is simple, but it varies depending on the model. The Model 3 is the most affordable at just $50 per month, while the Model X is the most expensive at $150 per month.
Model 3: $50 / month
Model Y: $60 / month
Model S: $125 / month
Model X: $150 / month
However, Tesla will also charge a $100 deductible for each service visit that covers an included repair, on top of the monthly subscription fee.
Exclusions
The ESA is an exclusionary warranty, meaning it covers the repair or replacement needed to correct a failure of most parts manufactured or supplied by Tesla. However, there are some parts not covered under the ESA, which include:
Issues arising from accidents, modifications, or environmental damage
Essentially, the ESA is designed to cover the components other than the drivetrain. That includes the touchscreen, computers, heat pumps, suspension, or other non-drivetrain electronics that aren’t covered after the 4-year basic warranty.
Tesla vehicles come with an extensive battery and drivetrain warranty that covers these items for up to 8 years. The maximum mileage varies by model. RWD Model 3 and Model Ys are covered for the first 100k miles, while Long Range Model 3s and Ys are covered up to 120k miles. The Model S and Model X are covered for up to 150,000 miles or 8 years.
Eligibility and Sign-Up
Eligibility for the new ESA subscription is pretty clear-cut.
Your vehicle must be within its 4-year / 50,000-mile Basic Vehicle Limited Warranty. Tesla will send customers whose basic warranty is about to expire a notification approximately 3 months before the time-based expiry.
The subscription is not available for leased vehicles or vehicles that were purchased used. Tesla plans to offer eligibility to customers who purchase their vehicle at the end of a lease by the end of 2025, and for used vehicle customers in the near future.
The Cybertruck, due to its relatively newness to the market, doesn’t have access to the ESA quite yet - but it will be coming “in the near future.” For Canada and Mexico in particular, the ESA is not yet available, but Tesla has confirmed plans to bring this subscription to other regions soon.
Subscribing is done through the Tesla App. Tap Upgrades> Service Plans > Extended Service Agreement. Once you review the terms and the monthly fee, you can then hit Subscribe and confirm your payment information.
If the ESA is not visible, your vehicle is not eligible for the subscription.
Payments for the ESA only begin once your original warranty has expired. However, you can sign up at any time, and payments will automatically start when your factory warranty expires.
Other Service Plans
Tesla also offers a Windshield Protection Plan and a Wheel and Tire Protection Plan, if you didn’t already know. Both of these plans are subscription-based and are currently only available in the United States. However, Tesla has indicated that it plans to expand to other regions in the near future.
