Tesla The U.S. electric car giant announced the launch of a revamped version of its popular Model Y in China on Friday, as it faces challenges from domestic rivals.

Model Y starts at 263,500 yuan ($35,935), with deliveries expected to begin in March. This is 5.4% more expensive than the starting price of the previous generation Model Y.

A Tesla China spokesperson said that the new Model Y is only open for pre-sale in the Chinese market and has not been launched globally.

Tesla’s Model Y update comes after the auto giant reported this month that its Overall deliveries in 2024 post first annual decline.

Elon Musk’s electric car company is facing stiff global competition from European startups and legacy carmakers. In China, the company continues to face fierce attacks from rivals. BYD For new players like this Xpeng Motors and Nioh.

Tesla offers several incentives to customers who purchase Model Y, including a five-year zero-interest financing plan.

Tesla said the new Model Y can accelerate from 0 to 100 kilometers per hour in 4.3 seconds, exceeding the speed capabilities of the previous model. Model Y Long Range can travel longer on a single charge than its predecessor.

Tesla has not launched a new model since it began delivering the Cybertruck, which starts at nearly $80,000, in late 2023.

Investors have been eager for a new mass-market model to revive sales. Tesla has previously hinted that it may launch a new affordable model in the first half of 2025.

Despite Tesla facing headwinds, the company’s shares have risen nearly 70% in the past 12 months, in part due to CEO Musk’s close relationship with U.S. President-elect Donald Trump.