Tesla Motors has reduced the price of a Model 3 by $1,100 across the current range, which translates into a new base price of $42,900 before incentives.
If you count in the still available federal tax credit and fuel savings, the Model 3’s base price drops to $34,850 for the rear-wheel drive version, as seen on the company’s website.
Tesla said that the Model 3 price reduction comes as a result from the end of their referral program “which cost far more than we realized”, a spokesperson for the company told Electrek, repeating what Musk said in a since-deleted tweet back in late January.
The federal tax credit for Tesla is due to be cut in half by July, adding $1,875 to the price of its models. Elon Musk tweeted “we’re doing everything we can” to finally offer the much advertised and unsubsidized $35k base Model 3 to the market which proves to be more difficult than expected for Tesla. “It’s super hard grind”, Musk added.
Model 3 starting cost now ~$35k (after ~$8k of credits & fuel savings) https://t.co/46TXqRrsdr
— Elon Musk (@elonmusk) February 6, 2019
The company’s founder said that Tesla must achieve higher volumes and manufacturing design improvements in order to offer the $35k Model 3 and still be a viable company in January, announcing at the same time a reduction of around 7 percent in its workforce.
Tesla’s first Model 3 cars have also started arriving in Europe, with the all-wheel drive Long Range version being the cheapest Model 3 available to customers there. Tesla will increasingly rely on sales from Europe and China to keep them going, now that the federal tax credit is being phased out.
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