The poster child for electric vehicles, Tesla, has had a difficult year. For the first time since becoming public, the company’s value was wiped out in the billions in 2022. Thus, there were questions when the company said last week that it was cutting the cost of its electric cars (EVs) by as much as 20%. Investors are nervous about the move in light of the recent controversy surrounding Elon Musk, the company’s CEO. Some investors are seeing this as an indication that Tesla is prepared to resolve its stock price issues.
What will the new prices be in 2023?
Prices for all Tesla models have decreased, though some more than others. The base Model Y unit is currently priced at $52,990, which is over 20% less than $65,990. The Model 3 Performance is now available for $53,990 at retail, down from $62,990. The most costly Tesla is the Model S Performance, but if you’ve been eyeing one, you can save $21,000. Its current price is $114,990, which is a reduction of more than 15%.
According to company representatives, the price reduction was brought about by declining costs in the supply chain and logistics, allowing them to pass these savings forward to the customer. There are others who question if this statement contains all of the truth. Elon Musk claimed last year that the company’s pricing had risen to a “embarrassingly high” level just as a recession was about to hit.
Does Tesla have a problem?
Like a lot of the big US corporations, Tesla has also been affected by the downturn in the economy. After hitting record highs of $400 earlier in the year, the price of Tesla shares has fallen by more than two-thirds over the previous year, currently trading at about $104 a share. The CEO’s personal turmoil hasn’t improved it’s financial situation. This week, Elon has been giving testimony in court about accusations that, following his tweet last year announcing he had sufficient funds to take Tesla private, he was misleading investors.
Everyone is aware of Musk’s now-famous acquisition of Twitter, which has been rapidly losing money due to a string of layoffs and the departure of advertisers. Musk raised money for the new business by selling $3.6 billion worth of Tesla stock in December. Undoubtedly, the unfortunate acquisition has been among several diversions – a cause for anxiety for investors.
