Tesla’s Model 3 is no more cheaply available in the market. Tesla CEO Elon Musk said on Twitter, shortly before the latest price hikes, that Tesla was seeing significant recent inflation pressure in raw materials and logistics.
No-more the Cheapest Model 3
In 2021 Tesla’s Model 3 was its best-selling automobile, with about 540,000 units sold. Since introducing the Model 3, Tesla became the world’s most valuable automaker, only years after facing questions of whether it would survive as a business. But the price difference for what is considered to be the entry-level Model 3 appears to be a deviation from Tesla’s original plans.
During an interview in 2013, Musk said that the automaker would create a car that priced on the order of $35,000. Tesla unveiled the Model 3 in April 2016, with Musk saying that “In terms of price, well, of course, it will be $35,000.”
Fluctuating Prices of Model 3
Tesla began Model 3 deliveries in July 2017 with more than half a million reservations for the $35,000 vehicle. But Tesla did not deliver its first Model 3s at the $35,000 price until April 2019.
The hardware of the $35,000 Tesla’s Model 3 matched a $39,500 version of the vehicle, but Tesla used software to limit the battery’s range and disable the seat warmers. The $35,000 Model 3 also shipped without Autopilot, Tesla’s driver-assist software, which is standard on the cheapest Model 3 today.
Now, the most affordable Model 3 has 52 more miles of range and a slightly higher top speed, 140 mph vs. 130 mph. Aside from price, the only apparent disadvantage of today’s most affordable Tesla is a slightly slower 0-60 mph time, 5.8 seconds vs. 5.6 seconds.
Nudging Customers for Buying Expensive Models
The $35,000 vehicle couldn’t be purchased online either, which seemed to nudge customers toward buying a more expensive vehicle. While no $35,000 Model 3 could be bought then, Tesla promised even lower pricing.
“It was always our goal to try to make an affordable electric car,” Musk said. “I think probably like about three years from now we’re confident we can make a very compelling $25,000 electric vehicle.” Musk said in January 2022 that Tesla wasn’t currently working on a $25,000 car.
“At some point we will,” Musk said. “But we have enough on our plate right now.”
