The most affordable EV, the Model 3 RWD, has dropped from $46,990 to $43,990, while the 5-seat Model Y Long Range fell 20 percent from $65,990 to $52,990. This means that the Model Y now qualifies for the $7,500 US Federal Tax credit, resulting in a final price drop of $20,500, or over 30 percent.
All other models, including the Model S, Model X, and performance versions of the Model 3 and Model Y, also saw price cuts. However, the 7-seat option on the Model Y has increased in price by $1,000 to $4,000. Despite this increase, the Model Y still qualifies for the Tax Credit as it is classified as an SUV. Prices for the Model 3 and Model Y were also cut in Germany, Austria, Switzerland, and France.
Customers looking to receive the full $7,500 rebate must place their orders before mid-March, when the rebate is expected to be reduced to half that amount. The tax rebates apply to SUVs priced below $80,000 and cars under $55,000. The Model Y fell into both categories, depending on the number of seats, meaning certain 5-seat models were not eligible, which CEO Elon Musk called "messed up." Now, all Model Y EVs except the Performance version appear to qualify.
Tesla recently cut prices in China and did not provide compensation to customers who complained. The Model 3 now starts at 229,900 yuan ($33,425) in that country. Tesla and CEO Elon Musk have not commented on the recent price cuts, but potential buyers will no doubt be pleased (and recent purchasers displeased). The Model 3 was originally supposed to cost $35,000 and shipped in that configuration for a short time, but saw steady increases to the $46,990 price announced in March 2022. Last month, Musk said that "radical interest rate changes" had affected vehicle affordability and that Tesla could potentially lower prices.
Source: Engadget