Tesla announced the launch of cheaper versions of two of its electric vehicles Tuesday in hopes of reviving flagging sales

Tesla's lower-priced versions of its staple Model Y SUV and Model 3 sedan face an uphill battle in the region where Elon Musk's company arguably needs help the most: Europe. Unveiled on Tuesday, the $39,

Elon Musk has said his automaker would sell an affordable Model Y, as “people don’t have enough money in the bank account to buy it” despite high demand.

"I'm definitely not buying them. For the same price, there are far more options I can get from local automakers," one user wrote on Weibo.

Tesla Inc. shares recovered some ground Wednesday after a rout in the previous session as cheaper Model 3 and Model Y versions disappointed many who hoped for entirely new cars or even more affordable prices. Beyond some investors buying in the dip, there could be a couple of reasons for Wednesday’s turnaround.

Tesla teased an October 7 event, in which investors and analysts anticipate the unveiling of a more affordable vehicle to counter falling sales, sending the shares of the Elon Musk-led electric automaker more than 5% higher on Monday.

Tesla unveiled less expensive versions of its Model 3 and Model Y vehicles on Tuesday after months of anticipation.

Elon Musk’s electric car company said the new versions would start at around $37,000 and $40,000, prices that bring its cars closer to comparable gasoline vehicles.

Nonetheless, Tesla is encountering ongoing difficulties in Europe, where opposition to CEO Elon Musk’s political views and increasing competition from BMW,

A lawsuit filed in California alleges Musk’s Tesla is actively prioritizing H-1B hires over U.S. workers, with one plaintiff claiming he was going for a job at the company, after being contacted by a recruiter, only to be told that the position was H-1B only.

— CNBC's Sean Conlon, Spencer Kimball, Laya Neelakandan, Yun Li, Lora Kolodny, Natasha Abellard, Julie Coleman, Kevin Breuninger, Jeff Cox, Jessica Dickler and Erin Doherty contributed to this report. Josephine Rozzelle edited this edition. Gold reached the $4,000 per ounce mark for the first time ever. The S&P 500 snapped a seven-day win streak.