Tesla (NASDAQ:TSLA) stock fell 3% to $208 a share in premarket trading on the NASDAQ amid reports of a 5% to 9% cut in Chinese car prices.

The company cut prices for its electric vehicles for the first time this year after a previous increase amid rising production costs. Back then, it faced increased competition from local electric car manufacturers, including BYD, Nio and Xpeng (NYSE:XPEV).

The price of the base model Tesla Model 3 of local production was reduced from 279.9 thousand to 265.9 thousand yuan ($36.774). The starting price of the Model Y SUV, made in China, was reduced from 316.9 thousand to 288.9 thousand yuan, RBC notes.

According to the China Association of Passenger Car Manufacturers, almost 80% of electric vehicle sales in the first seven months of the year came from automakers in China. Tesla is the third largest electric vehicle manufacturer in China after BYD Motor and SAIC-GM-Wuling.