Tesla has just announced pricing of the Model S in China and it is on par with prices in the U.S. The premium 85 kWh battery pack version of the Model S will be priced at 734,000 yuan (around $121,000 U.S.).

So, you may be wondering if they are equally priced, why is it $40,000 more in China than the $81,000 price tag in the U.S.? The difference comes from import duties, taxes and transportation charges – Tesla called these unavoidable. Tesla also notes drivers will have access to the free Supercharger network it plans to build.

Tesla is recognizing that this pricing strategy is quite risky as traditional foreign car mark-up in China can be double. Anything different than that structure could be considered of less value. On the Tesla blog they call this “unconventional” saying, “This pricing structure is something of a risk for Tesla, but we want to do the right thing for Chinese consumers. … ”

For example, Forbes offers the comparison that the Mercedes S-Class starts at 1.25 million yuan in China ($206,000 U.S). In the U.S. the S550 is priced at $93,000+, which is closer to the U.S. price of the Model S.

There is some concern by Tesla that competitors will try to convince consumers that the lower price means a lesser-value car.

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