Header image depicts the new Tesla Model Y. Image source: Tesla.
Tesla’s Model Y, one of its bestsellers, moved around 481,000 units in 2024. This year, the company gave the vehicle a facelift, announcing the refresh on January 10 and opening preorders on the same day.
The new rear-wheel-drive version boasts a range of 593 kilometers and is priced at RMB 263,500 (USD 36,890), while the long-range variant extends to 719 kilometers and costs RMB 303,500 (USD 42,490). Unlike previous updates that often came with price hikes, this time, Tesla has kept pricing largely stable—raising the base model’s price by only RMB 13,600 (USD 1,904).
This restrained approach may be a strategic response to an evolving Chinese market. Xiaomi’s SU7, a rising contender, recently overtook Tesla’s Model 3 as China’s bestselling pure electric sedan in both December 2024 and January 2025.
And the competition is only heating up. In 2025, homegrown brands with more experience under their belt are lining up a wave of new releases to challenge the Model Y:
- Xiaomi, a household name rivaling Tesla in brand equity, plans to launch its YU7 SUV between May and June.
- Xpeng’s midsize electric SUV, the G7, has already appeared in a new vehicle announcement released by China’s Ministry of Industry and Information Technology (MIIT).
- Huawei’s Luxeed R7, under the Harmony Intelligent Mobility Alliance (HIMA), topped sales charts for pure electric SUVs priced above RMB 250,000 (USD 35,000) with 11,000 deliveries in January.
- Li Auto, well-known for its dominance in the family car segment, is set to release its first pure electric model, the i7, later this year.
Is the new Model Y another blockbuster?
Tesla began deliveries of the refreshed Model Y on February 26, rolling out showroom and test drive units across its stores nationwide.
But the launch atmosphere felt noticeably different from Xiaomi’s SU7 frenzy, where customers lined up for test drives across the country. 36Kr’s visits to four Tesla stores in Beijing—located in Dongcheng, Chaoyang, and Daxing districts—painted a contrasting picture. Store traffic was sparse, and test drives were available without wait times.
Yet, order volumes tell a different story. Several Tesla sales representatives told 36Kr that since preorders opened on January 10, each Tesla store in Beijing had been adding roughly 100 new orders per day. According to them, the new Model Y has already accumulated 200,000 orders in China.
But how many of those orders will convert into actual purchases?
A key detail raises doubts. Before deliveries began, Tesla’s website clearly stated that deposits for the Model Y were refundable. But on February 26, the day deliveries started, that disclaimer quietly disappeared from the order page.
Now that showroom units are available, most visitors had already placed a RMB 1,000 (USD 140) deposit. Many had preordered blindly, waiting to see the car in person. “As soon as we posted on WeChat that the car had arrived, they came straight over for test drives,” a Tesla salesperson said.
According to a Tesla insider, the long-range variant has a higher conversion rate. “We’re expediting deliveries of the standard rear-wheel-drive version. Some customers who were originally scheduled to receive their cars in four weeks are already being contacted for pickup,” the insider noted.
To push last-minute sales, Tesla extended its initial buyer incentives. Customers who placed orders from February 26–28 could still claim:
- A two-year extended warranty worth RMB 8,000 (USD 1,120).
- A home charging station for RMB 1,299 (USD 181.9), down from the original RMB 5,200 (USD 728).
- Supercharging credits: six years or 5,000 kilowatt-hours (about 30,000 kilometers) at RMB 1 (USD 0.14) per kWh—down from the usual RMB 2–3 (USD 0.28–0.42) per kWh.
While Tesla didn’t slash the sticker price, these bundled perks effectively amounted to over RMB 11,000 (USD 1,540) in discounts—enough to sway some undecided buyers. One salesperson told 36Kr that these two days of first-batch incentives helped close dozens of new deals.
In its first week, Tesla delivered more than 6,000 units of the refreshed Model Y nationwide. But in Beijing, deliveries were in the hundreds, significantly lower than past first-week figures, which ranged between 1,000 and 3,000 units.
“It’s just the first week. Production will ramp up, and the current delivery timeline has already been pushed to 4–6 weeks,” a Tesla source said.
Interestingly, Tesla’s competitors have yet to mount an aggressive counteroffensive. Unlike in previous years, when rival brands ran side-by-side feature comparisons with the Model Y, 36Kr’s visits to HIMA, Xpeng, and Zeekr stores suggest a more relaxed stance. HIMA salespeople even expressed confidence in their brand’s competitive edge.
An industry insider revealed that after Tesla launched the refreshed Model Y, Onvo executives presented a detailed comparison to William Li, CEO of parent company Nio, arguing that the Onvo L60 had a clear advantage.
Still, actual order volumes tell a different story—China’s EV startups can’t afford to be overly optimistic.
Tesla launches FSD in China—but doesn’t recommend buying it
Alongside the Model Y refresh, Tesla quietly rolled out its long-awaited ace: Full Self-Driving (FSD).
On February 25, Tesla pushed a software update to select users in China, enabling advanced driver assistance features like traffic light recognition and U-turn capabilities.
But rather than boosting Tesla’s sales, the FSD launch has been met with caution—even from Tesla’s own sales staff:
“It’s still running on training data from overseas, so performance in China may be inconsistent. … We recommend waiting. Improvements could come in a week, or they might take a few months. Plus, RMB 64,000 (USD 8,960) is steep. A monthly subscription plan is coming soon, so buying now isn’t worth it.”
Unlike Chinese automakers that aggressively market self-driving features, Tesla is taking a more cautious approach—perhaps to temper expectations before exceeding them.
Still, the competition isn’t standing still. Since Tesla’s FSD launch, media and users have run various tests. Li Auto CEO Li Xiang even claimed that his company’s AD Max system required fewer interventions than Tesla’s FSD.
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KrASIA Connection features translated and adapted content that was originally published by 36Kr. This article was written by Xu Caiyu for 36Kr.