The $35,000 Tesla Model 3 was hailed as the affordable electric car for the average person, the modern-day Volkswagen Bug, when it first appeared (and then vanished) in 2019. However, the Tesla Model 3 is now more affordable to purchase than ever before thanks to a recent price decrease by Tesla and increased inflation in the US during the previous four years.
What is the reason for the price cut on Tesla Model 3?
The decision represents a shift in the automaker’s strategy from the previous two years when the demand for new vehicles outstripped the supply. It happens after CEO Elon Musk forewarned that it would decrease prices to continue growth at the expense of profit due to the possibility of a recession and higher interest rates.
A base Tesla Model 3 can now be purchased for $43,990 thanks to a significant price reduction for Tesla automobiles, and with the EV tax credit in the United States, the cost is further lowered to $37,390. And for residents of particular states or municipalities, the price can be further reduced thanks to regional subsidies and EV incentives, frequently approaching the $35,000 threshold that the Tesla Model 3 was praised for back in 2019.
However, in light of the significant increase in inflation over the previous four years, this offer becomes even more alluring. This has resulted in the $35,000 Model 3 of 2019 costing just over $40,000 in “2023 dollars,” making the current Model 3 the most affordable model ever. This same record-breaking pricing is available on more items than simply the Model 3. Using the same maths, the base model Tesla Model Y is now $45,190 (after federal incentives) than it has ever been.
The Tesla Model S and Model X, which are the brand’s luxury/high-performance options and have rarely been referred to as “affordable,” have perhaps been made more competitive by this pricing change. The Model S now has a starting price of just under $100,000, making it the best supercar offer available for one of the world’s fastest automobiles. When compared to rival models from Jaguar, Land Rover, or Rivian, the Model X’s starting price of $109,990 makes the huge three-row SUV a verging on a steal.
As demand for electric vehicles rises and Tesla sales expand internationally, hopefully the company can continue to work to offer customers accessible EV options in the years to come. And even while widespread suffering from rising prices over the previous year is clear, there is one bright spot in the new year in this situation.
