Elon Musk releases cheaper Model Y and Model 3 models
Tesla on Tuesday introduced more affordable versions of its best-selling Model Y SUV and Model 3 sedan, priced at $39,990 and $36,990, respectively, as the electric vehicle maker tries to reverse falling sales and shrinking market share amid increasing competition.
The starting price for both versions, called Standard, is about 15 percent cheaper than the base Model Y. According to the company website. The estimated range of 516 kilometers of the new versions is 10 percent below the premium versions. They will come with a stripped-down interior and will lack Autosteer, Tesla’s driver assistance system, or touchscreens for the rear passenger.
Tesla shares fell 2.1 percent in afternoon trading on Wall Street after rising 89 percent in the past six months. Chief Executive Officer Elon Musk has been promising mass-market vehicles for years, but last year canceled plans to produce an all-new $25,000 EV, Reuters first reported.
More affordable models are vital for Tesla’s 20 million vehicle sales target, which it needs to reach for Elon Musk’s $1.5 trillion salary package.Credit: Bloomberg
Late last year, Musk said the vehicle would be priced below the “base threshold” of $30,000, including US EV tax credits. In the United States, prices actually rose by $7,500 at the end of last month when the credit expired. This helped push quarterly sales to a record high, but expectations are that sales will slow for the rest of the year unless affordable cars come to the rescue.
“The desire to buy the car is very high. (It’s) just people don’t have enough money in their bank account to buy it,” Musk said during Tesla’s second-quarter earnings call in July.
“So the more affordable we can make the car, the better.”
Tesla had released two clips on the X over the weekend that sparked excitement among fans. One video shows headlights peeking out from the darkness, and another video shows what appears to be a wheel spinning for several seconds, followed by “10/7”, the US format for the date of October 7.
Musk had initially promised that production of the vehicle would begin at the end of June. However, Tesla said in a statement in July that it was producing only “early versions” of the car, adding that it would be available to customers in the last three months of the year.
