By Jiahui Huang


Tesla is preparing to launch a six-seat version of its Model Y in China, as it battles to maintain market share amid intensifying competition from local rivals.

The company posted a picture of the sports utility vehicle on social media site Weibo late Wednesday, saying: "Model Y L, see you in the fall!"

According to a government approval document on the Chinese Ministry of Industry and Information Technology's website, the new Model Y will be larger than the current five-seat version and will have a top speed of 201 kilometers an hour.

Tesla has been under increasing pressure from domestic carmakers in China, where it has been outsold in several segments by BYD and Geely Automobile.

Still, the Model Y remains the best-selling SUV in China, and a new version could help Tesla regain some of the ground it has lost to local brands in the world's largest EV market.

The U.S. company's China sales rose 0.8% on the year in June, ending an eight-month streak of declines.

The price Tesla sets for the upsized Model Y will be closely watched.

China's auto market has been gripped by price wars as companies compete to win over consumers that are reluctant to spend. BYD triggered the latest round of price cuts earlier this year by slashing prices on its flagship models, prompting authorities to urge automakers to avoid a "toxic" pricing war.

Xiaomi, a new joiner of the China's EV market, launched its YU7 model in June, posing a direct threat to Tesla's models.

Government subsidies for car purchases have helped prop up demand but analysts say the auto market may face slowing momentum in the second half of the year.

The effects of the subsidy program are expected to fade, and lingering economic uncertainty continues to weigh on consumer confidence.

Regulators are also cracking down on unhealthy competition, further limiting space for price cuts.

In a meeting chaired by Chinese Premier Li Qiang on Wednesday, the State Council said it would step up price monitoring in the EV sector.

That echoes recent efforts by industry groups and authorities to encourage automakers to moderate its price cuts and foster a healthier competitive environment. Still, some consumers adopted a watch-and-see approach for prices to stabilize.


Write to Jiahui Huang at jiahui.huang@wsj.com


(END) Dow Jones Newswires

07-16-25 2357ET