Tesla is back to cutting prices in China, and investors don’t seem happy about it. Shares of the electric vehicle maker slipped Monday after it cut prices for some of its cars in the country again, reigniting a price war in the world’s biggest auto market. The manufacturer announced a significant discount for its Model Y in China on Monday, saying two models would be discounted by 14,000 yuan ($1,929) effective immediately. The long-range model will now cost 299,900 yuan ($41,340), while the performance model will be priced at 349,900 yuan ($48,200), according to Tesla\n \n (TSLA) posts on Chinese social media and its website. That would mean reductions of 4.5% and 3.8%, respectively. Additionally, buyers of Tesla’s Model 3 will receive a subsidy of up to 8,000 yuan ($1,107) if they purchase the car through a preferred insurance provider through the end of September, the company said. The move failed to impress investors. Tesla’s stock slid 1.2% in New York on Monday following the announcements. The price cuts, Tesla’s first since January, reflect rising competition in China, particularly within its fast-moving electric vehicle sector. HSBC automotive analysts said Tuesday that they saw “rising pricing pressure driven by competition, higher inventories, and low-season promotions.” “Since the beginning of August, we have noticed that various [automakers] including Tesla, Zeekr, and Leapmotor have adopted more aggressive pricing tactics,” they wrote in a report. The trend could continue throughout the third quarter, they predicted, with market leaders such as Tesla, BYD and other brands becoming “increasingly more aggressive.” China is vital to Tesla, with deliveries from its Shanghai Gigafactory alone accounting for more than half of its global sales, according to a CNN calculation based on data from the China Passenger Car Association. The company has heavily experimented with pricing there after losing ground to competitors, such as Warren Buffett-backed BYD. Tesla slashed prices several times in China between October and January after losing market share. In April, CEO Elon Musk hinted at more price cuts to help boost sales. The reductions kicked off a price war in the country, with dozens of car manufacturers following suit by offering steep discounts. The cuts also pushed Tesla’s profit margin to its lowest since 2020, though the company reported a larger-than-expected rise in profits for the last quarter. The latest slash marks another U-turn for Tesla. In May, the company had reversed course, hiking prices globally, with the biggest increase made in China. Analysts said at the time that Tesla may have been trying to send a nudge to customers who were hoping for even more reductions.