Tesla Model 3 And Y Are Nearly $10000 More Expensive Than A Year Ago

Tesla Model 3 And Y Are Nearly $10,000 More Expensive Than A Year Ago

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The price of Tesla’s cheapest cars keeps climbing, but the demand for these popular electric vehicles hasn’t waned and supply troubles persist.

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Tesla Model 3 And Y Are Nearly $10000 More Expensive Than A Year Ago

Tesla has been steadily and rapidly raising prices on its two cheapest electric vehicles over the past several months resulting in a price that’s now nearly $10,000 higher overall compared to the same time last year. While this might be shocking news for customers, it represents just how much demand there is for these cars. Whether this will slow the market down or not is unclear, but Tesla is recognized as a leader in emissions-free vehicles.

Tesla’s plan for the Model 3 was to make it a low-cost electric car for the masses. Pricing of $35,000 was the target aimed for, and briefly hit, as soon as the standard range model came to market in February of 2019. The online option for the $35,000 model disappeared within a few months, although it could be special ordered. The realities of production constraints, making enough batteries, and sourcing other components became even more difficult when the pandemic hit in 2020 and price increases ramped up in 2021.

The Tesla Model 3 now costs $44,990 for the base model, subtracting any government incentives and before any taxes or fees are added. It’s worth noting that Tesla continually improves its cars, so the lowest cost Model 3 available currently has a longer range than the $35,000 model. Still, it’s a big price increase and the same has happened with the Model Y. Tesla’s second cheapest electric vehicle cost $41,990 at the beginning of 2021 and the lowest priced configuration is now $57,990. The Standard Range model was dropped from the company’s lineup this year, making the Long Range model, which cost $49,990 earlier this year, now the cheapest.

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Why Tesla Prices Are Increasing

Tesla is having trouble with its supply chain, as is every major manufacturer. Reports of chip shortages affecting automakers have been making headlines for months and Tesla is not immune to these issues. Chips aren’t the only problem and Tesla has stated that it’s basically hard to get a variety of parts with shipping and factory schedules disrupted worldwide.

The price rises account for the extra costs that Tesla faces as it reroutes and improvises new solutions to keep production flowing, but it is also a reality of the rule of supply and demand. If customers are buying a product faster than it can be made, the logical move is for a company to raise prices. This might slow sales but, at the higher price, profit might actually improve or at least hold steady. It’s a balancing act to find the optimal price to fit the situation and Tesla’s pricing of the Model 3 and Model Y might not hold at the present high mark if demand slows. Not to mention, with Tesla seeing more competition arriving every month, that might have an affect as well.

Link Source : https://screenrant.com/tesla-model-3-model-y-price-increases-last-year/

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