Tesla has reduced the prices of certain Model 3 and Model Y variants in the U.S. following lower-than-expected third-quarter deliveries. The initial cost of the Model 3 now stands at $38,990, a decrease from the previous $40,240, while the long-range Model 3 has dropped from $47,240 to $45,990. Additionally, the Model 3 Performance is now priced at $50,990, down from $53,240. Tesla’s Model Y Performance SUV has also seen a price adjustment, starting at $52,490 compared to the earlier price of $54,490.
Tesla’s Global Price Cuts: Challenges & Strategy
Since the end of the previous year, Tesla has been consistently reducing its car prices globally to stimulate demand, especially amid concerns about a slowdown in consumer spending in key markets like the U.S. and China, coupled with heightened competition in the electric vehicle sector. Tesla frequently adjusts its car prices, particularly in its primary markets of the U.S. and China.
This recent round of price cuts follows Tesla’s report of third-quarter deliveries totaling 435,059 vehicles, falling short of analyst predictions and showing a decline from the preceding quarter. The company attributed the decrease to factory upgrades leading to downtime at manufacturing sites.
Elon Musk, Tesla’s CEO, has openly expressed the company’s strategy to prioritize higher volume over larger profit margins this year. This approach has proven successful for Tesla, with its shares experiencing a growth of over 100% this year. Despite the recent price adjustments, Tesla remains committed to its goal of delivering 1.8 million vehicles by the end of the year.
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