The cost of a premium Tesla Model Y electric vehicle in the US is now at the level of the average new car. Achieving price parity with ICE vehicles is a game changer for the entire EV market.
Electric vehicle technology has already proven to be reliable, and extensive charging infrastructure networks have significantly reduced consumer concerns about the range of electric vehicles. The desire to buy an electric car instead of a car with an internal combustion engine continues to grow among consumers, and an increasing number of them are considering buying EVs. However, the cost of electric vehicles exceeds the cost of ICE vehicles, so many consumers still cannot afford to buy one.
Tesla CEO Elon Musk has been saying for several years that one of the company's main goals is to achieve price parity with ICE cars. This would allow consumers to choose between an EV and an internal combustion engine car, and the price would no longer play a decisive role. To this end, Tesla has done a great job developing new manufacturing processes and technologies. The company has been successful in doing this, as its price-cutting policy, launched in early 2023 and now gaining momentum, has made buying some Tesla models a bargain.
Model Y now costs less than a typical new car sold in the US, according to Bloomberg's report. At $46,990, the base Model Y is now $759 less than the average car or truck in the US. The difference between those numbers has changed by more than $20,000 since the middle of last year. To date, no automaker has achieved such a dramatic reduction in the cost of cars in mass production. Model Y was the best-selling EV in the US last year, and one of the top SUVs of any type.
While the company's uncertain investors fear that Tesla is cutting prices due to plummeting demand, and critics are trumpeting from all corners that no one is interested in the company's cars, the Texas manufacturer is making another coup. By making its cars a better buy for consumers, Tesla will attract many new customers who will switch to an electric car and will no longer be interested in buying a car with an internal combustion engine. This in turn leads to the fact that Tesla is gradually and confidently accelerating the transition of the world to sustainable energy.
© 2023, Eva Fox | Tesmanian. All rights reserved.
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About the Author
Eva Fox joined Tesmanian in 2019 to cover breaking news as an automotive journalist. The main topics that she covers are clean energy and electric vehicles. As a journalist, Eva is specialized in Tesla and topics related to the work and development of the company.