Tesla Model Y Cheaper Than Ever in USA

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One week ago, I wrote about the Tesla Model Y (and the Tesla Model 3) having a base price below the average selling price of a new car in the US. In fact, taking the US EV tax credit into account, the Model Y was essentially $10,000 cheaper than the average selling price of a new car in the US, which is $47,244. Now the Model Y is even cheaper.

Last week, the Model Y’s starting price was $44,990 (or $37,490 after the full $7,500 US EV tax credit). Now, the Model Y’s starting price is $42,990 (or $35,490 after the full $7,500 US EV tax credit).

Or you can go for a Model Y Long Range and get about 50 miles more range on a full charge and quicker acceleration — 4.8 seconds from 0–60 mph versus 6.6 seconds from 0–60 mph. That option now starts at $47,990 (or $40,490 after the full $7,500 US EV tax credit).

Will this lead to a big boost in sales? Presumably, yes. In part because every $1,000 or $2,000 you move down the price curve from mid-tier pricing, you do open up the market to considerably more buyers. Also, with this being the lowest the Model Y has ever cost, it’s got to be tempting to buy now. If demand rises, Tesla can go raise prices tomorrow, and one never knows if they’ll be this low again. To be honest, I’m tempted.

Unfortunately, the free color is currently dark grey — no offense to anyone who likes that, but it’s my least favorite. To get a nice white one or blue one, you have to plop down another $1,000. And to get the white seats, which I think are an absolute must in hot climates like Florida, that’s another $1,000. Still, you’re basically now getting those two things for free compared to a week ago thanks to the $2,000 drop in price!

As noted yesterday, the Tesla Model Y outsold the Model 3 by a whopping 3:1 last quarter. So, how about the Model 3 — what’s its pricing?

The Model 3 has a starting price of $38,990, the same as last week. However, not being eligible for the $7,500 US EV tax credit and there being the tex credit loophole for leases, Tesla is pushing the low lease price these days. Leasing starts at $299/month. That’s quite an appealing offer in itself, is it not?

Clearly, both have their own appeal. The Model 3 has been upgraded, with new technology, an infotainment screen in the back, better back seats, and a new design of course. It’s also got the slightly more fun driving qualities of a smaller sedan. The Model Y, meanwhile, has the extra cargo space, more room in the back, and a higher seating position. It seems clear that most buyers currently favor the Model Y, seeing as 3 times more of them were sold than Model 3s in the first quarter. We’ll see if that changes in the second quarter.


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Zachary Shahan

Zach is tryin' to help society help itself one word at a time. He spends most of his time here on CleanTechnica as its director, chief editor, and CEO. Zach is recognized globally as an electric vehicle, solar energy, and energy storage expert. He has presented about cleantech at conferences in India, the UAE, Ukraine, Poland, Germany, the Netherlands, the USA, Canada, and Curaçao. Zach has long-term investments in Tesla [TSLA], NIO [NIO], Xpeng [XPEV], Ford [F], ChargePoint [CHPT], Amazon [AMZN], Piedmont Lithium [PLL], Lithium Americas [LAC], Albemarle Corporation [ALB], Nouveau Monde Graphite [NMGRF], Talon Metals [TLOFF], Arclight Clean Transition Corp [ACTC], and Starbucks [SBUX]. But he does not offer (explicitly or implicitly) investment advice of any sort.

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