Tesla announced another round of price cuts, this time to versions of its Model 3 and Model Y cars.
The Model 3's starting price is now $38,990, down from $40,240. The Model 3 Long Range costs $45,990, down from $47,240. The Model 3 Performance's price dropped from $53,240 to $50,990, and the Model Y Performance starts at $52,490, down from $54,490. Both cars qualify for federal tax credits for the purchase of electric vehicles, further incentivizing the switch from gas-powered cars.
The price cuts were announced shortly after Tesla's third-quarter vehicle production and deliveries report revealed that sales fell short of analyst expectations. The company saw $23.4 billion in sales, compared to an expected $24.1 billion.
Tesla attributed the drop-off in sales to construction at factory sites that has interfered with the company's production capabilities.
Tesla has made frequent price cuts since the end of 2022. The cuts aim to drive demand for EVs and specifically for Teslas as more automakers have started producing EVs, creating competition for Tesla.
Thomas Martin, senior portfolio manager at Tesla shareholder Global Investments, told Reuters that he expected further price cuts from Tesla. "I don't think the price cuts are over, mainly for the reason that demand is still weak," he said.
The price cuts are good for environmentally conscious drivers. Though more automakers are recognizing the demand for EVs, the average EV is more than $5,000 more expensive than a gas-powered vehicle. With more affordable EVs, more drivers will be able to make the switch to electric, keeping harmful emissions out of our atmosphere.
"Hopefully this is a good indication of the Cybertruck pricing," one user responded to the announcement, referring to Tesla's long-awaited electric truck. "Glad more EVs are becoming more affordable."
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