France: Renault revising its prices globally after Tesla slashes

French automobile company, Renault is revising its pricing plans of electric cars worldwide to safeguard its competitive status after a wave of price cuts by U.S. rival Tesla Incorporation, a top executive said on Monday.

After slashing prices several times in the United States, Tesla on Friday cut prices in Europe- including on Renault’s home turf of France – as well as Israel and Singapore, expanding a global discount drive it began in China in January.

“We will analyse country by country, market by market, which level of competitiveness we need to have to stay in the game,” Fabrice Cambolive, the chief executive of the Renault brand, told reporters on Monday.

The brand’s sales rose 9% in the first quarter of the year, indicating a restructuring strategy focusing on the most profitable models may be starting to pay off after four years of declining revenues.

Cambolive said the rebound had extended into April, adding however that Tesla’s price cuts were a wake-up call for competitors.

He said sales of Renault’s Megane electrified model, one of its most popular, had risen sharply in March, with strong orders despite a very limited discounting policy. But the model now costs as much as its main Tesla competitor.

After last week’s price cut by Tesla, the Tesla Model 3 in France starts at 41,990 euros, compared with 42,000 euros for the Megane electric.

The Megane E sold 3,570 units in France in the first quarter, compared with 3,158 Tesla Model 3s, though the U.S. carmaker also sold 9,364 of its more upmarket SUV Model Y in the country.

“It’s clear that (Tesla cutting prices) is a challenge, starting with the cost side of things. It’s a warning that we are looking at,” Cambolive said.

Worldwide sales for the Renault brand reached 354,545 vehicles in the first three months of the year.