Volkswagen Won’t Cut Prices Like Tesla, Says Exec

Tesla has left Volkswagen in a tough spot on the veteran automaker’s home turf after recently dropping the prices of its Model 3 and Model Y electric vehicles (EVs) by up to 16.8% in Germany. The discounts, which Tesla said were a result of “normalizing” inflation, have led to increased demand for and interest in the EV pioneer’s vehicles.

However, Volkswagen doesn’t plan on making price cuts of its own to retaliate, according to a report from German publication FAZ.NET (via @Berlinergy).

Oliver Blume, Chairman of Volkswagen’s Board of Management, told the German newspaper Frankfurter Allgemeine Sonntagszeitung that the company won’t wage a price war against its American competitor.

“We have a clear pricing strategy and rely on reliability. We trust in the strength of our products and brands,” Blume said, per a Google translation of his statement in German. He added that Volkswagen wants to be “a leading global” supplier of electric cars, but the company wants to achieve this through “profitable growth.”

Tesla became Germany’s top-selling EV brand last year, overtaking Volkswagen for the first time. With the recent price cuts, demand for Tesla’s electric cars is only expected to surge further.

Alongside Germany, Tesla also reduced its prices in several other European countries, as well as the U.S., Canada, China, Australia, New Zealand, and beyond.