Lowering prices can have several potential drawbacks for a company like Tesla. Firstly, it can lead to a decrease in profit margins if the cost of production remains the same. Secondly, it can create a perception of lower quality among consumers, as people often associate price with quality. Thirdly, it can lead to a price war with competitors, which can further erode profit margins. Lastly, if the price is reduced too much, it may not cover the cost of production, leading to losses.
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