Tesla is launching a facelifted Model Y in China to fend off its local rivals

Tesla It announced an updated version of the popular Model Y in China on Friday, as the US electric car giant looks to fend off challenges from local rivals.

The Model Y will start at 263,500 Chinese yuan ($35,935) and will begin shipping in March. That’s 5.4% more than the previous Model Y’s starting price.

A Tesla China spokesperson said the new Model Y is only open for initial sales in the Chinese market, not globally.

Tesla’s Model Y update follows the auto giant’s announcement this month First annual decline in total supplies for 2024.

Elon Musk’s electric car firm is facing increasing competition around the world, from startups in Europe and traditional automakers. In China, the company continues to face an onslaught from competitors BYD for new players like Xpeng and Nio.

Tesla is offering a number of incentives for customers to buy a Model Y, including a five-year 0% interest financing plan.

The new Model Y can accelerate from 0 km/h to 100 km/h in 4.3 seconds, surpassing the speed capabilities of Tesla’s previous car. Model Y Long Range has a longer driving range on a single charge than its predecessor.

Tesla hasn’t introduced a new model since it began shipping the Cybertruck in late 2023, which starts at around $80,000.

Investors were eager for a new mass-market model to revive sales. Tesla has previously hinted that a new affordable model could go on sale in the first half of 2025.

Despite Tesla’s headwinds, the company’s shares have risen nearly 70% over the past 12 months, in part because of CEO Musk’s close relationship with US President-elect Donald Trump.