By Alex Vuocolo 

Tesla's discounting spree continues with some of its largest price cuts ever in the U.S., slashing the price of new models by up to 20 percent. 

The Model Y basic now runs for $52,990, when it cost $65,990 a day ago, according to the Tesla website. Cuts were also made to other versions of the Model Y and the Model 3. 

Tesla is offering similar price cuts made in the European market. 

The heavy discounts come less than a week after Tesla lowered prices in China — a move that has since led to a surge of purchase orders in the country. Tesla had continually raised its prices in recent years, as demand for EVs skyrocketed, and supply chain issues hampered production. 

CEO Elon Musk said last spring that Tesla's prices had become "embarrassingly high." 

One explanation for the sudden turn to discounts is that Tesla's production capacity, which for many years struggled to ramp up, is now outpacing demand. 

"Tesla’s production capacity now hugely outstrips its rate of incoming orders, which undoubtedly explains why the company is implementing layoffs and a hiring freeze, and its used car prices are plunging too, further killing demand for new ones," read an analysis from ValueWalk, a financial research site. 

The usually talkative Musk has been silent about the price cuts on social media, opting instead to highlight SpaceX's recent achievements. 

Shares of Tesla fell nearly 8 percent in pre-market trading.