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Tesla Reduces Model 3 & Y Prices in US, Further Expanding Affordability

Tesla Reduces Model 3 & Y Prices in US, Further Expanding Affordability

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Tesla is again reducing the cost of Model 3 and Model Y in the US. The new round of price cuts should make electric vehicles affordable to a wider range of consumers, which has always been Tesla's goal.

Tesla has again applied price cuts to Model 3 and Model Y in the United States. According to the company's website, the entry-level Tesla Model 3 RWD is now $2,000 cheaper and starts at $39,990 (down from $41,990 previously). The price of the Performance version has not changed. The Long Range AWD is still not available for order but is expected to be reintroduced later this year. All three versions of Model Y received a $3,000 price cut. The base Model Y now starts at $46,990 (down from $49,990 previously).

While many may speculate that Tesla is losing demand and consumers are no longer interested in buying its vehicles, this is not true. Of course, the company adjusts prices in accordance with the general market situation and the purchasing power of consumers. Lower prices stimulate demand. However, the key here is that Tesla is at a point where it can lower its car prices to make them more affordable to a variety of consumers, not just wealthy customers.

During the Q4 2022 Earnings Call, Elon Musk explained that reducing the price of cars is important because there are a huge number of people who want to buy a Tesla car, but cannot afford to. Thus, the price changes the company has applied really matter to the average consumer. In addition, price cuts have made Tesla vehicles eligible for purchase subsidies in several major markets, including the US. Tesla's goal has always been to make electric vehicles available to as many people as possible, so Musk is glad the manufacturer is finally able to do this.

“It's sometimes for those -- for people who are well -- who have a lot of money, they sort of forget about how important affordability is. And it's always been our goal at Tesla to make cars that are affordable to as many people as possible, so I'm glad that we're able to do so. And yes, so I think it's a good thing, all things considered.”

© 2023 Eva Fox | Tesmanian. All rights reserved.

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Article edited by @SmokeyShorts; follow him on Twitter

About the Author

Eva Fox

Eva Fox

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.

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