Author(s)

Hao Yang, Wenya Yan, Fucheng Xu

Corresponding Author

Hao Yang

ABSTRACT

Since Tesla entered China, the electric car market has developed fastly, forming into an oligopoly market. Tesla’s development strategy has significant reference values for other electric car companies. Starting from 2020, Tesla initiated multiple price cuts of its products to enlarge its market share. This paper adopts the literature research method, comparative method, and analysis of Tesla’s price elasticity to study Tesla’s advantages and disadvantages of its pricing strategy, and the measure that should be taken. Through the comparison with BYD, it is concluded that Tesla has localized economic advantages and direct-sale caused brand advantages. Tesla’s larger demand elasticity and smaller supply elasticity enable it to use price cuts to increase sales in a short term.

KEYWORDS

Tesla, BYD, Sales Strategy, Pricing Strategy