Tesla has boosted prices by up to $6,000 for all models but not all versions of its electric cars.
The company’s cheapest vehicle, the rear-wheel-drive Model 3, was not included in the Wednesday cost hikes, and remains at $46,990. Despite years of promises from Tesla of a $35,000 mass-market version, the car was only available at that price for a very short window.
One of the other two Model 3 versions, the dual-motor, all-wheel-drive “Performance,” also saw its price stay the same — $62,990 — but the cost of the basic dual-motor, all-wheel drive Model 3 jumped $2,000 to $57,990.
The company in December moved its headquarters to Austin, despite expanding its office footprint in Palo Alto and continuing to operate a factory in Fremont that CEO Elon Musk said in April may expand significantly.
Tesla did not immediately respond to questions about the price hikes, which were first reported by website Electrek. Wedbush Securities analyst Dan Ives attributed Tesla’s price-boosting to the supply problems and inflation that have arisen globally for many industries amid the coronavirus pandemic. “Price increases across the supply chain are catalyzing these latest price increases from Tesla as they pass them along to the consumer,” Ives said. “It’s the nature of the beast in this inflationary backdrop.”
Tesla’s main production focus, Ives said, is the Model Y SUV, which is the next model up from the Model 3 in cost. The firm hiked prices for both versions of the Model Y, with a $3,000 increase to $65,990 for the dual-motor, all-wheel-drive, and a $2,000 boost to $69,990 for the “Performance” version.
For the Model S sedan, the dual-motor, all-wheel-drive version went up $5,000 to $104,990, while the cost of the three-motor “Plaid” version stayed at $135,990.
The biggest increase hit the dual-motor, all-wheel-drive Model X compact SUV, with Tesla increasing the price by $6,000 to $120,990. The cost of the triple-motor Plaid version remained at $138,990.
Tesla last hiked car prices in March, after Musk tweeted that Tesla was suffering from “significant recent inflation pressure in raw materials & logistics.”
Governments around the world are setting targets to electrify transportation. California has ordered that all new cars and light trucks sold must be zero-emission by 2035, and the White House wants half of all new-vehicle sales to be EVs by 2030, but electric cars remain far out of reach for most Americans. America’s median pre-tax income was $1,037 per week in the first three months of this year, according to the U.S. Bureau of Labor Statistics, so the cheapest Tesla would eat up almost 90% of the average person’s annual income.
Prices for high-end electric cars from Cadillac, Rivian and Lucid have also gone up. General Motors earlier this month announced it would cut the price of its cheapest Chevrolet Bolt to $26,595, making the vehicle the cheapest U.S. electric car, but even that price would take half the average American’s pre-tax earnings.
