Tesla Inc (TSLA) slashed the starting price of its Shanghai-produced Model 3 sedans on Thursday by nearly 8% to 249,900 yuan ($36,800*), after state purchase subsidies, the US company stated on its China website. Previously, China-made Model 3 sedans with a standard driving range were priced at as low as 271,550 yuan.
Tesla shares closed higher for the sixth time in the past ten trading sessions on NASDAQ on Wednesday. The stock went up 2.37% ($9.94) to $429.01, after touching an intraday high at $433.67, or a price level not seen since September 22nd ($437.76).
Shares of Tesla Inc have risen 412.74% so far in 2020 compared with a 30.75% gain for the benchmark index, Nasdaq 100 (NDX).
In 2019, Tesla Inc’s stock went up 25.70%, thus, it underperformed the Nasdaq 100, which registered a 37.96% gain.
The standard range Model 3 vehicles will now be equipped with lithium iron phosphate batteries that are less costly compared to the nickel cobalt manganese cells used previously, according to a report by Reuters.
At the same time, the starting price of Model 3 sedans with a longer driving range has been reduced to 309,900 yuan from 344,050 yuan previously.
Tesla’s China vehicle sales exceeded 11,000 units in August, with the majority of them being Model 3s.
* 1 US Dollar equals 6.7908 Chinese Yuan
Analyst stock price forecast and recommendation
According to CNN Money, the 32 analysts, offering 12-month forecasts regarding Tesla Inc’s stock price, have a median target of $321.90, with a high estimate of $800.00 and a low estimate of $19.00. The median estimate represents a 24.97% downside compared to the closing price of $429.01 on September 30th.
The same media also reported that at least 17 out of 37 surveyed investment analysts had rated Tesla Inc’s stock as “Hold”, while 8 – as “Sell”. On the other hand, 9 analysts had recommended buying the stock.