Tesla has introduced more affordable versions of its Model Y SUV and Model 3 sedan, priced at USD 39,990 and USD 36,990, respectively. Within the automotive industry, this move marks a strategic effort to expand access to electric vehicles amid shifting incentives and mounting competition.
These new "Standard" models are planned in a way attract cost-conscious consumers following the expiration of the U.S. federal electric vehicle tax credit.
However, some analysts and investors have expressed concerns that the pricing may still be too high to significantly boost demand, especially amid increasing competition from other automakers.
Elon Musk, the Chief Executive has for years promised mass-market vehicles, though last year he cancelled plans to build an all-new USD 25,000 EV.
In the United States, prices effectively rose by USD 7,500 at the end of last month, when the EV tax credit ended. That helped goose quarterly sales to a record, but expectations are that they will slow down for the rest of the year, unless the affordable car comes to the rescue.
Affordable cars are pivotal for Tesla to achieve its goal of delivering 20 million vehicles over the next decade, a key milestone in the proposed USD 1 trillion performance-based compensation package for CEO Elon Musk.
Executive Statement
According to Chief Executive Elon Musk, the desire to buy the car is very high. People don’t have enough money in the bank account to buy it. So, the more affordable we can make the car, the better.