Tesla has reduced prices for its range of electric cars, marking the third time this year that the company has lowered prices for some of its models. According to the Associated Press, the recently updated prices were displayed on Tesla’s website on Friday. Model S and Model X models are now available at a discounted price of up to $5,000, while the Model 3 is available at a discounted price of $1,000. Additionally, the Model Y has seen an effective price cut of $3,000, with the introduction of a new base model starting at $49,990. Previously, the least expensive Model Y was the Long Range version, which costs $52,990 and remains unchanged.
Tesla Supercharger
This move follows January’s price reductions, where Tesla lowered prices of up to 20% across all its models. In March, the company also cut prices of the Model S and Model X, by up to $10,000. These reductions come as a drastic change from 2022, where Tesla raised prices multiple times. The company, however, has not publicly disclosed the reason for the latest round of price cuts.
Tesla’s recent report indicated that it delivered 422,875 vehicles in the first quarter of 2023, slightly higher than the previous quarter and an increase of 36% compared to the previous year. However, it was the second consecutive quarter where the company produced more vehicles than were delivered to customers. According to the automaker’s quarterly disclosures, in the last four quarters, Tesla has manufactured around 78,000 more vehicles than those it has sold.
2023 Tesla Model S – Courtesy of Tesla, Inc.
As the AP reported, these reductions come at a time when Tesla is ramping up its manufacturing capabilities. Besides its original factory in Fremont, California, Tesla has opened newer facilities in Austin, Texas, and Shanghai. The company also started operations at a factory in Germany in 2022.
Though some analysts predicted an EV price war in February (as mentioned in this article), the majority of automakers have not decreased their prices. The Ford Mustang Mach-E saw a reduction in January of up to $5,900, but more recently, Ford raised prices on the F-150 Lightning pickup truck for the fourth time.
