Tesla is once again cutting prices in the US

Tesla has again cut prices for its key models in the US after a drop in deliveries last quarter. The starting price for the Model 3 on Friday was $38,990 – that was $1,250 less than before. A few days earlier, the electric car manufacturer had again offered a cheaper version of the Model Y compact SUV.

Tesla still sells by far the most electric cars in the US. But recent sales figures also show that buyers continue to appreciate full-size pickup trucks and SUVs – often opting for hybrid powertrains, which are cheaper than fully electric models. Americans’ willingness to spend money is slowed down, among other things, by higher interest rates.

Tesla delivered 435,059 vehicles to customers last quarter – almost seven percent fewer than in the previous three months. The company justified this with production interruptions to replace machines in factories. But even with the planned production shutdowns, experts had expected around 20,000 additional cars to be sold. In this quarter, Tesla would need to deliver about 475,000 vehicles to meet its annual target of 1.8 million.

Thanks to its high production capacity and established production, Tesla has more room for price reductions than the major car companies that are just starting to shift their focus to electric vehicles. Prices also fell again for some raw materials. In addition, Tesla boss Elon Musk states that with digitized cars you can also earn money later with software updates and other services. However, price reductions put pressure on profit margins.

(sda/awp/dpa)