Tesla has raised its prices across its vehicle lineup, and this was pretty much expected. Inflation has everyone and their grandmother raising prices. The most affordable Model 3 in the US is now $46,990, Bloomberg reported while noting that this was Tesla’s second time raising prices within the last week. Earlier this month, Tesla raised the prices of some of its Model 3 and Y variations, and then increased the prices for its made-in-China vehicles the next day.
Over the weekend, Tesla CEO Elon Musk shared a thread on Twitter that started with a question:
“What are your thoughts about probable inflation rate over the next few years?”
He added that both Tesla and SpaceX were seeing significant recent inflation pressure in raw materials and logistics. He then shared an article by Financial Times adding that Tesla and SpaceX were not alone with this problem.
And we are not alone https://t.co/1RpsIbGWMl
— Elona Musk (@elonmusk) March 14, 2022
The article Elon shared reported that commodity prices soared to their highest level since 2008 thanks to Russia supply fears. An analyst at JPMorgan, Dominic O’Kane, told FT that what was happening between Russia and Ukraine could have implications on long-term supply.
Commodities ranging from oil and gas and coal to wheat and nickel are seeing insane price rises. The article noted that wheat prices have risen 60% since the beginning of February and that both Russia and Ukraine account for just under 30% of the global wheat exports. Perhaps those TikToks I saw over the summer warning of a food shortage were on to something. I’ve been stocking up — not on the toilet paper hoarder levels, but the “buy an extra can here and buy an extra package of rice there” level — and am happy now that I’m seeing a cost increase on things ranging from food to Uber rides.
Inflation will hit the poorest the hardest. Whether one is in extreme poverty in the US or in another area of the world, many will feel the pressure of inflation on their wallets. It’s not a good feeling having to put food back because you can’t afford it — I’ve been there many times.
I think my own experiences have helped me to cope pretty well but we have a younger generation that probably isn’t ready for the type of inflation that hasn’t been seen in a generation or so. And with Covid turning 2022 into “2020, too,” who knows how high inflation will go?
It makes sense that Tesla raised its prices. It has to if it wants to survive — and so does any business. Well, except the oil giants, which are essentially drowning in profits but don’t really care about those who are dependent on its products.
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