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Tesla Offers New China Rebate as Price Cuts Rock EV Market

Residents walk past a Tesla showroom in Beijing, Wednesday, May 31, 2023. (AP)
Residents walk past a Tesla showroom in Beijing, Wednesday, May 31, 2023. (AP)
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Tesla Offers New China Rebate as Price Cuts Rock EV Market

Residents walk past a Tesla showroom in Beijing, Wednesday, May 31, 2023. (AP)
Residents walk past a Tesla showroom in Beijing, Wednesday, May 31, 2023. (AP)

Tesla on Friday offered a new incentive to boost electric vehicle sales in China as it notified some workers making battery packs at its Shanghai complex of layoffs, according to a company announcement and a worker who had received the notice.
Tesla announced the cash rebate offer on new cars a day after joining 15 other companies, including Chinese EV makers Nio, Li Auto and Xpeng, in a pledge to avoid "abnormal pricing", interpreted by some to signal a truce in a price war that has threatened industry-wide profitability, Reuters said.
Taken together the developments point to the pressure Tesla and rivals face in China's EV market - the world's largest.
The pricing pledge signed by executives was organized by the China Association of Automobile Manufacturers.
Output at Tesla's Shanghai Gigafactory, the company's largest and most productive hub, would not be affected by the layoffs, according to people with knowledge of the operations at the factory complex that employs about 20,000 workers.
While a round of price cuts led by Tesla boosted sales earlier this year, the competition has put pressure across the board on automakers and suppliers to contain costs, analysts and executives say.
Tesla said on Friday it would offer new buyers of its Model Y and Model 3 vehicles a cash rebate of 3,500 yuan ($483) if they could cite a referral from an existing owner.
Separately, workers in Tesla's Shanghai complex assembling battery packs were informed of layoffs, according to a worker who had received the notice.
The layoffs were first reported by Chinese online news portal Deep Analysis on Thursday, which said fewer than 1,000 workers were employed on the factory's two battery pack production lines.
Bloomberg reported on the layoffs on Friday, citing people familiar with the matter.
It was not clear how many workers could be let go or reassigned, or the specific reason behind the layoffs.
Tesla did not immediately respond to a request for comment.
'UNHEALTHY' COMPETITION
Tesla sold a record 247,217 China-made vehicles in the second quarter, data released earlier this week showed. That was the highest since it started delivering vehicles from its Shanghai factory in early 2020.
Volkswagen's China CEO Ralf Brandstatter said in a speech last month at an event attended by Chinese Premier Li Qiang that China's EV market was marked by "high price discounts" and "an unhealthy competitive environment."
Hyundai Motor, the world's No. 3 global automaker by sales, said last month it would close a plant in China and look to sell it with a factory it shut last year.
Consultancy Alix Partners said this week that while China's EV market would continue to grow rapidly, intensifying competition and excess capacity would also drive a shakeout.
Only 25 to 30 out of the 167 companies registered to produce EVs or plug-in hybrids in China will survive by 2030, the consultancy forecast.
The firm also said 2023 would be the first year that Chinese brands would account for over 50% of cars sold in their home market, a first.
For the past four decades, China's auto market has been dominated by established global brands, such as VW, operating in joint ventures with Chinese partners.
Tesla is the only foreign automaker operating a plant without a local partner.
Since the start of 2023, Tesla has cut the base price of the Model 3 sedan in China by 14% and by 10% for the Model Y, its global best seller.
On Friday, Tesla also said new buyers would also have free access to its Enhanced Autopilot driver-assistance system for 90 days.
Tesla announced the new incentives on its Weibo account. It is continuing an offer it announced in June of 7,000-yuan rebates to buyers of its more expensive Model S and Model X vehicles.
A number of Tesla owners posted their referral codes online and invited others to use them on Friday, suggesting the new cash rebate could be widely available for new buyers.
Tesla's sales of cars produced in Shanghai in the second quarter accounted for over half of its global deliveries.
The company's shares have climbed almost 70% since early May, as investors reacted to indications its global price cuts and US government incentives were boosting sales and bet the EV maker would be able to stabilize its profit margin over time.
Earlier this week, Tesla cut prices on the Model 3 and Model Y by between 3% and 4% in Japan.

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Technology

AI to Track Icebergs Adrift at Sea in Boon for Science

© Jonathan NACKSTRAND / AFP
© Jonathan NACKSTRAND / AFP
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AI to Track Icebergs Adrift at Sea in Boon for Science

© Jonathan NACKSTRAND / AFP
© Jonathan NACKSTRAND / AFP

British scientists said Thursday that a world-first AI tool to catalogue and track icebergs as they break apart into smaller chunks could fill a "major blind spot" in predicting climate change.

Icebergs release enormous volumes of freshwater when they melt on the open water, affecting global climate patterns and altering ocean currents and ecosystems, reported AFP.

But scientists have long struggled to keep track of these floating behemoths once they break into thousands of smaller chunks, their fate and impact on the climate largely lost to the seas.

To fill in the gap, the British Antarctic Survey has developed an AI system that automatically identifies and names individual icebergs at birth and tracks their sometimes decades-long journey to a watery grave.

Using satellite images, the tool captures the distinct shape of icebergs as they break off -- or calve -- from glaciers and ice sheets on land.

As they disintegrate over time, the machine performs a giant puzzle problem, linking the smaller "child" fragments back to the "parent" and creating detailed family trees never before possible at this scale.

It represents a huge improvement on existing methods, where scientists pore over satellite images to visually identify and track only the largest icebergs one by one.

The AI system, which was tested using satellite observations over Greenland, provides "vital new information" for scientists and improves predictions about the future climate, said the British Antarctic Survey.

Knowing where these giant slabs of freshwater were melting into the ocean was especially crucial with ice loss expected to increase in a warming world, it added.

"What's exciting is that this finally gives us the observations we've been missing," Ben Evans, a machine learning expert at the British Antarctic Survey, said in a statement.

"We've gone from tracking a few famous icebergs to building full family trees. For the first time, we can see where each fragment came from, where it goes and why that matters for the climate."

This use of AI could also be adapted to aid safe passage for navigators through treacherous polar regions littered by icebergs.

Iceberg calving is a natural process. But scientists say the rate at which they were being lost from Antarctica is increasing, probably because of human-induced climate change.

 

Technology

AMD Predicts Weaker First-Quarter Sales, Shares Plunge on Nvidia Comparisons

An AMD logo and a computer motherboard appear in this illustration created on August 25, 2025. (Reuters)
An AMD logo and a computer motherboard appear in this illustration created on August 25, 2025. (Reuters)
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AMD Predicts Weaker First-Quarter Sales, Shares Plunge on Nvidia Comparisons

An AMD logo and a computer motherboard appear in this illustration created on August 25, 2025. (Reuters)
An AMD logo and a computer motherboard appear in this illustration created on August 25, 2025. (Reuters)

Advanced Micro Devices on Tuesday forecast a slight decline in quarterly revenue, raising concerns about whether it ​can effectively challenge Nvidia in the booming AI market and sending its shares tumbling 8% in after-hours trade.

The lackluster prediction comes despite an unexpected boost from sales of certain artificial intelligence chips to China, which began in the last quarter after the Trump administration approved a license for orders that AMD received in early 2025.

And without those sales to China which generated $390 million, AMD's data-center segment would have missed estimates for the fourth quarter.

AMD said it expects revenue of about $9.8 billion this quarter, plus or minus $300 million. That's down from $10.27 billion in the fourth-quarter which was up 34% year-on-year and ahead of LSEG ‌estimates for $9.67 billion.

PALES ‌NEXT TO NVIDIA

Though AMD is seen as one of the ‌few ⁠contenders ​that can seriously ‌challenge Nvidia, investors noted the stark contrast between the two companies' performances. AMD expects an adjusted gross margin of 55% this quarter. Nvidia has said it expects adjusted gross margin in the mid-70% range during its fiscal 2027.

"The expectations for large blowout quarters for AI-related hardware companies have skewed what the market is looking for," said Bob O'Donnell, president of TECHnalysis Research.

The forecast for the current first quarter includes $100 million from sales to China, where the situation remains "dynamic," AMD CEO Lisa Su said on a conference call with investors.

The US government ⁠has placed restrictions on the exports of advanced chips to China, but AMD received licenses to sell modified versions of its MI300 series ‌of AI chips there. Its MI308 chip competes with Nvidia's H20 ‍chip in China.

OPENAI SALES

AMD has accelerated its ‍product launches and is moving into selling full AI systems to better compete against Nvidia, which now ‍provides "rack-scale" systems that combine GPUs, CPUs and networking gear.

Last year, it entered into a multi-year deal to supply AI chips to ChatGPT-owner OpenAI, which would bring in tens of billions of dollars in annual revenue and give the startup the option to buy up to roughly 10% of the chipmaker.

Su reiterated on Tuesday that the company ​expects sales of a new flagship AI server to OpenAI and others to rise rapidly in the second half of this year, saying a global memory-chip crunch will not ⁠slow its plans.

"I do not believe that we will be supply-limited in terms of the ramp that we put in place," Su said.

BEYOND OPENAI

As Big Tech and governments across the globe double down on investing in AI hardware, shares in Santa Clara, California-based AMD have doubled since the start of 2025, outperforming a 60% bump in the broader chip index.

But analysts remain concerned that AMD's success remains tied to a handful of customers that rivals such as Nvidia could try to poach. Reuters reported this week that Nvidia made a $20 billion move to hire most of chip startup Groq's founders after OpenAI held chip supply discussions with the startup.

"Growth appears concentrated in large deployments and specific regions, and China shipments are significant enough to influence a quarter," said eMarketer analyst Gadjo Sevilla.

Revenue in AMD's key data-center segment grew 39% to $5.38 billion in the ‌fourth quarter. But excluding sales of the MI308, which is a data-center chip, that revenue would have been $4.99 billion, below estimates of $5.07 billion.

Technology

Switch 2 Sales Boost Nintendo Results but Chip Shortage Looms

This photo taken on November 4, 2025 shows a woman taking photos of a Super Mario figure at the Nintendo Tokyo store in Tokyo. (AFP)
This photo taken on November 4, 2025 shows a woman taking photos of a Super Mario figure at the Nintendo Tokyo store in Tokyo. (AFP)
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Switch 2 Sales Boost Nintendo Results but Chip Shortage Looms

This photo taken on November 4, 2025 shows a woman taking photos of a Super Mario figure at the Nintendo Tokyo store in Tokyo. (AFP)
This photo taken on November 4, 2025 shows a woman taking photos of a Super Mario figure at the Nintendo Tokyo store in Tokyo. (AFP)

The runaway success of the Switch 2 console drove up Nintendo's net profit by more than 50 percent in the nine months to December, the Japanese video game giant said Tuesday.

But a global memory chip shortage, created by frenzied demand for artificial intelligence hardware, could push up manufacturing costs.

The Switch 2 became the world's fastest-selling games console after launching to a fan frenzy last summer.

It is the successor to the original Switch, which soared in popularity during the pandemic when games such as "Animal Crossing" struck a chord during long lockdowns.

Both are hybrid devices that can be connected to a TV or used on-the-go.

In April-December, net profit jumped 51.3 percent year-on-year to 358.9 billion yen ($2.3 billion), and revenue nearly doubled on-year to 1.9 trillion yen, Nintendo said.

But the firm kept its annual unit sales target for the Switch 2 steady at 19 million, and also held its full-year net profit forecast of 350 billion yen.

"Nintendo Switch 2 got off to a good start following its launch on June 5 and unit sales continued to grow through the holiday season," the company said.

Nearly 17.4 million Switch 2 devices were sold in the nine-month period, it added.

"Maintaining momentum is certainly a big focus for Nintendo," Krysta Yang of the Nintendo-focused Kit and Krysta Podcast told AFP.

A lack of heavy-hitting first-party new games for the Switch 2 in coming months risks hindering growth, although third-party titles such as "Resident Evil Requiem" should help fill the gap, she said.

Nintendo said Tuesday it planned to release "Mario Tennis Fever" this month and "Pokemon Pokopia" in March.

While the firm is diversifying into hit movies and theme parks, consoles remain the core of its business.

The Switch 1 has now sold 155.37 million units -- overtaking the Nintendo DS console to be its best-selling hardware of all time.

But soaring prices for memory chips, used in gaming consoles as well as phones, laptops and other electronics, will likely be a headwind for the company.

Their prices have been pushed up as chipmakers focus on producing the advanced memory chips in huge demand to power AI data centers.

"Nintendo and other console manufacturers are publicly keeping quiet about the impact of the shortage," gaming industry consultant Serkan Toto told AFP.

But "users can forget the past when consoles always became cheaper in tandem with component costs falling over time", with price hikes potentially on the way in 2026, he said.

Yang said she thought a price increase for the Switch 2 "is not out of the question" but added that Nintendo "would likely exhaust all other options" before doing so.