Electric Vehicules : Tesla cuts prices in US and Europe

After steadi­ly increas­ing prices over the past two years, Tes­la appears to have cut prices across all its mod­els in the U.S. and Europe to boost sales.

The cheap­est EV, the Mod­el 3 RWD, dropped 20% from $46,990 to $43,990, and the five-pas­sen­ger Mod­el Y Long Range from $65,990 to $52,990.

That means the lat­ter mod­el was eli­gi­ble for a $7,500 fed­er­al tax cred­it, so the final price drop is more than 30% at $20,500.

Oth­er mod­els, such as the Mod­el S and Mod­el X (reg­u­lar and plaid ver­sions), and the Mod­el 3 and Mod­el Y per­for­mance ver­sions, have all been dis­count­ed as well.

How­ev­er, the Mod­el Y sev­en-pas­sen­ger option is up $1,000 to $4,000. So although it’s priced at over $55,000, it’s con­sid­ered an SUV, so it’s tax deductible.

In Ger­many, the com­pa­ny cut Mod­el 3 and Y prices by 1% to 17%, as well as in Aus­tria, Switzer­land and France.

To receive the full $7,500 rebate, orders must be placed by mid-March, when the half price is expect­ed. This tax rebate applies to SUVs val­ued at $80,000 or less and auto­mo­biles val­ued at $55,000 or less.

The Mod­el Y fits both, depend­ing on how many seats it has, and some five-pas­sen­ger mod­els don’t qual­i­fy, in what CEO Elon Musk called “a mess.” Now it seems to cov­er all “Mod­el Y” except “Per­for­mance”.

Late last year, first in Chi­na and then in the U.S., it was report­ed that Tes­la’s inven­to­ries were pil­ing up after sev­er­al years of strong sales.

Tes­la recent­ly cut prices in Chi­na, but has since refused to offer any com­pen­sa­tion to com­plain­ing cus­tomers. The Mod­el 3 cur­rent­ly starts at 229,900 yuan ($33,425) in the country.

Nei­ther Tes­la nor CEO Elon Musk have com­ment­ed on the price cut, but poten­tial buy­ers will no doubt be pleased (and recent buy­ers will be offended).

The Mod­el 3 was orig­i­nal­ly slat­ed for $35,000 and shipped in that con­fig­u­ra­tion for a short peri­od of time before climb­ing steadi­ly up to the announced price of $46,990 in March 2022.

Last month, Mr. Musk said the “pump­ing in inter­est rates” had affect­ed the afford­abil­i­ty of cars, and that Tes­la could low­er prices.