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In the ever-evolving Chinese electric vehicle (EV) market, Tesla is preparing to launch the Model Y L, a six-seater version of its popular SUV, to counteract declining sales and increased competition.
Tesla China's sales have been on a downward trend for the past ten months, with a year-over-year decrease in nine out of ten months for the first ten months of 2022. This trend continued in the first half of 2025, as the Model Y sold 171,491 units, representing a 17.5% year-over-year decrease.
The Model Y, which accounted for 74.6% of Tesla's domestic sales in 2024, has been losing momentum in China since the launch of the facelifted version called Juniper in January. Sales figures for Tesla China in July 2022 decreased by 8.4% compared to the same month in 2021, and the company sold 67,886 EVs in that month.
However, the Model Y L, with its longer wheelbase and three rows of seating, including captain’s chairs in the second row, aims to address the growing demand for larger family-friendly vehicles in China's electric SUV segment, which now commands over 50% of the market. The model will feature ternary NMC batteries from LG and is expected to be priced around RMB 400,000 (~$55,710).
While the Model Y L promises to enhance Tesla’s product appeal, the company faces significant competition from local brands offering compelling features and competitive prices. The model's launch in the autumn of 2025 is expected to boost Tesla's attractiveness in the three-row SUV segment, potentially stabilising or even boosting sales. However, it is unlikely to fully reverse the downward sales trend without further innovation and competitive pricing.
In summary, the expected impact of the Tesla Model Y L launch in China is a potential boost in appeal and sales within the three-row electric SUV segment. However, it comes amid continued market share pressure from strong local competitors, making Tesla’s path to regaining significant growth challenging.
[1] Tesla's China Sales Plummet Amidst Fierce Competition from Domestic Brands
[2] Tesla Model Y L: A Six-Seater SUV for the Chinese Market
[3] China's Electric SUV Market: A Growing Opportunity for Tesla
[4] Tesla's New Model Y L to Compete with Popular Chinese MPVs and SUVs
[5] Tesla's Model Y L: Pricing and Launch Details
[1] Despite the decline in Tesla China's sales, the company faces a challenge in regaining significant growth due to fierce competition from domestic brands.
[2] In an attempt to counteract declining sales and increased competition, Tesla is introducing the Model Y L, a six-seater version of its popular SUV, in the Chinese market.
[3] The shift toward electric vehicles in China presents a growing opportunity for Tesla, with the electric SUV segment commanding over 50% of the market.
[4] The Model Y L will compete with popular Chinese MPVs and SUVs, proposing to address the growing demand for larger family-friendly vehicles in the market.
[5] The Model Y L, featuring ternary NMC batteries from LG and expected to be priced around RMB 400,000, is scheduled to launch in the autumn of 2025.
