Global pricing approaches that are significantly less complex can prove crucial in determining market success, according to Jato Dynamics.

Using live data from its Price Tracker tool to explore how OEMs are managing prices across different models, it highlighted how uniform pricing strategies across international markets can have a profound impact.

It cited Tesla’s changes in the German market in April 2023 as a case in point, using tracking data to demonstrate how the brand managed to boost competitiveness with a sudden price cut of its whole line up.

Jato Dynamics identified two pure price decreases of the Model Y in the German market within four months. In January 2023, Tesla reduced prices for all versions by €4,000 on average before a further €1,333 decrease that April. Simultaneously all versions of the Model Y Performance AWD saw a €4,000 price drop which equated to an overall average price reduction of 7%.

“Tesla has a similar pricing strategy in the US and the EU5 (France, Germany, Italy, Spain and the United Kingdom),” it noted, “with a very similar volume weighted average manufacturer suggested retail price (MSRP) in both regions. As a result, their offer approach is much less complex, which has a positive effect on the production costs.”