Tesla is cutting the price of its Model X and Model S cars in China, the firm said on Thursday, in a shift in strategy that will see it take more of a hit from tariffs linked to a biting trade war between China and the US.

The electric-car maker, led by billionaire CEO Elon Musk, said it will cut prices of the two models by 12 percent to 26 percent to make the cars more “affordable” in the world’s top auto market, where sales of so-called new-energy vehicles are rising fast.

The move comes amid severe trade tensions between China and the US, which has seen extra tariffs slapped on US imports into the country, including automobiles, hurting Tesla, which imports all the cars it currently sells in the market.

“We are absorbing a significant part of the tariff to help make our cars more affordable for customers in China,” Tesla said in a statement sent to Reuters.

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