Tesla has cut Model S and Model X prices, which come in base-all wheel (AWD) and performance. This comes a few days after Elon Musk said recent price cuts on other models had stoked demand.
The recent price cuts by Tesla are the fifth adjustment made by the company since the start of the year. The price reductions range from 4% on the performance version of the Model S to 9% on the more expensive Model X.
These price adjustments are likely part of Tesla’s strategy to keep its vehicles competitive in the market and attract more customers. By lowering the prices of their most expensive models, Tesla may be hoping to make their vehicles more affordable and accessible to a wider audience. The move may also be aimed at increasing demand and sales, which could help the company achieve its goal of producing and selling more electric vehicles.
Elon Musk, the CEO of Tesla, recently stated that the company focused on lowering prices to increase demand for its electric vehicles. Tesla introduced global discounts in January, which Musk says has led to an increase in orders.
“The desire for people to own a Tesla is extremely high,” Musk said last week at Tesla’s investor day. “The limiting factor is their ability to pay for a Tesla.”
In January, Tesla announced significant price cuts across all its markets, with discounts of up to 20%. Many industry analysts saw this move as a way for Tesla to maintain its leadership position in the electric vehicle market and to stay competitive with other automakers.
The company reduced the prices of its Model S and Model X vehicles by $5,000 and $10,000, respectively, across their base all-wheel drive (AWD) and performance “Plaid” editions.
The basic version of the Model S was cut by 5% to $89,990, while the performance Plaid variant was cut by 4% to $109,990. Similarly, the basic AWD version of the Model X was cut by 9% to $99,990, while the performance Plaid version was cut by 8% to $109,990.
Tesla’s market share of newly registered electric vehicles in the United States has decreased from 79% in 2020 to 65% in the third quarter of 2022. This indicates that Tesla is facing increased competition from other competitors who offer various affordable alternatives, an S&P Global Mobility report showed in November.
Despite declining market share, Tesla remains dominant in the US electric vehicle market. Its Model 3 and Model Y vehicles have been among the best-selling electric vehicles in the country, and the company has continued to expand its charging infrastructure to support its growing customer base.