Facebook Twitter

Tesla cuts prices for its EVs

Model Y and Model 3 are as cheap as they can be right now, as Tesla moved to slash prices

SHARE Tesla cuts prices for its EVs
Tesla’s Model Y is displayed at Tesla’s design studio Thursday, March 14, 2019, in Hawthorne, Calif. The Model Y may be Tesla’s most important product yet as it attempts to expand into the mainstream and generate enough cash to repay massive debts that th

Tesla’s Model Y is displayed at Tesla’s design studio Thursday, March 14, 2019, in Hawthorne, Calif.

Jae C. Hong, Associated Press

Tesla slashed prices for its electric vehicles in the U.S. and Europe after executing the same move in China and other Asian markets.

The New York Times reported that the new prices were visible late Thursday, where the high-end Model 3 Performance sold for nearly $54,000, cheaper than its previous price tag of nearly $63,000 — a 14% cut.

The automaker has not responded to requests for comment on the reason behind these price decreases. But, according to Axios, it may be a result of the stock tumbling 65% in 2022 as investors cast doubt on CEO Elon Musk’s ability to juggle his time between Tesla and the newly acquired Twitter.

Add tax credits on top of price cuts

The price cuts also affect the standard and high-end Model Y as well as the standard Model 3, as an independent EV researcher said in a tweet.

The price cuts may also qualify Tesla owners for EV tax credits of up to $7,500, making the vehicles much more affordable. But this move may risk upsetting customers who pre-ordered their Teslas before the change, per CNBC.

“This should really boost 2023 (Tesla) volumes,” Gary Black, “a Tesla investor who has remained bullish on the company and its prospects through the recent, sharp share price decline,” said in a tweet, per CNN. “It’s the right move.”

Tesla’s path in 2023

Austria, France, Germany, the Netherlands, Norway and Switzerland also saw prices decrease, per Reuters.

“We believe all together these price cuts could spur demand/deliveries by 12%-15% globally in 2023 and shows Tesla and Musk are going on the ‘offensive’ to spur demand in a softening backdrop,” Wedbush analyst Dan Ives told Markets Insider.

“This is a clear shot across the bow at European automakers and US stalwarts (GM and Ford) that Tesla is not going to play nice in the sandbox with an EV price war now underway,” he added.

In China, reductions were between 13% to 24%, with the Model 3 costing $33,427, down from $39,000. It instantly upset the Chinese customers who protested and demanded a refund of the price difference.