The Model Y Long Range sees massive 30% drop with Federal Tax Credit.
Jan 13 – Tesla (TSLA) There has been a significant Tesla price drop across its electric vehicle (EV) lineup in the US and Europe, in an effort to boost sales. The least expensive model, the Model 3 RWD, has dropped from $46,990 to $43,990. While the 5-seat Model Y Long Range fell 20 percent from $65,990 to $52,990. This means the Model Y now qualifies for the $7,500 US Federal Tax credit, resulting in a final price drop of over 30 percent. Other models such as the Model S and Model X and performance versions of the Model 3 and Model Y, also saw price cuts. However, the 7-seat option on the Model Y has increased in price by $1,000 to $4,000.
Model Y Long Range Now Qualifies For Fed Rebate
In order to receive the full $7,500 rebate, customers must order before mid-March, when it is expected to be reduced to half that amount. The tax rebates apply to SUVs priced below $80,000 and cars under $55,000. The Model Y falls into both categories, depending on the number of seats.
Tesla and CEO Elon Musk feels the price cuts are likely to please potential buyers. However, recent purchasers may be disappointed. The Model 3 was originally supposed to cost $35,000, but saw steady increases to the $46,990 price announced in March 2022.
In addition to the price cuts on the Model 3 and Model Y, Tesla has also made reductions on other models in its lineup. The Model S and Model X, both regular and plaid versions, have seen price cuts. Additionally, performance versions of the Model 3 and Model Y have also seen reductions in price. However, the 7-seat option on the Model Y has increased in price by $1,000 to $4,000.
In addition to a Tesla price drop in the US, Tesla has also made reductions on its EV lineup in Europe. In Germany, Model 3 and Model Y prices were cut by one to 17 percent. Prices also dropped in Austria, Switzerland, and France. It’s important to note that in order to receive the full $7,500 rebate on the Model Y in the US, customers must order before mid-March. The rebate it is expected to be reduced to half that amount after then.
It’s unclear what prompted the price cuts, perhaps due to a buildup of inventory or an effort to boost sales. Recently, there have been reports of Tesla inventory building up in China and the US. Tesla also recently cut prices in China, but later declined to provide compensation to customers who complained.
Musk previously mentioned that “radical interest rate changes” have affected vehicle affordability and that Tesla could potentially lower prices. Neither Tesla nor Musk have officially commented on the recent price cuts. But it’s likely that potential buyers will be pleased with the reductions, while recent purchasers may be disappointed.