Tesla raises prices for Models 3 and Y, cheapest car is now $ 42,000

Tesla has implemented a price increase on its entire Model 3 and Model Y lineup in a overnight update of its online configurator in the United States.

In the first half of 2021, Tesla stepped up price hikes across its range of electric vehicles.

The automaker would literally not go two weeks to raise the price of its vehicles.

CEO Elon Musk said the price increases were in part due to Tesla facing supply chain issues throughout the year, like the rest of the industry.

However, Tesla’s financial results also showed that its gross margin on its automotive business increased throughout the year.

In recent months, Tesla had halted its price increases, with the latest coming in July.

Now it looks like the automaker is back.

Tesla Model 3 price

In an overnight update to its online configurator in the US today, Tesla increased the price of the Model 3 Standard Range Plus and Performance.

Here are all the prices of the different versions of the Model 3:

• Tesla Model 3 Standard Range Plus: price dropped from $ 39,990 to $ 41,990
• Tesla Model 3 Long Range AWD: the price remained at $ 49,990
• Tesla Model 3 Performance: price dropped from $ 56,990 to $ 57,990

This is what the updated online configurator looks like:

The most significant change is obviously the $ 2,000 price increase of the Model 3 Standard Range Plus, which was Tesla’s cheapest car.

Earlier this year, the same version of the car started at just $ 36,990, which is a price increase of $ 5,000 or 13% for Tesla’s cheaper vehicle over just seven months.

Tesla Model Y Price

The Model Y was also subject to price increases with Tesla’s nightly update.

Like the Model 3, the cheaper version of the Model Y got a price increase of $ 2,000 and the performance version a price increase of $ 1,000.

Here are all the updated prices for all versions of the Model Y:

• Tesla Model Y Long Range Dual Motor: price dropped from $ 52,990 to $ 54,990
• Tesla Model Y Performance: Price dropped from $ 60,990. at $ 61,990

Here’s what Tesla’s Model Y configurator looks like after the nightly update:

The Model Y Long Range, which is the cheapest version of the electric SUV, has now seen its prices increase by $ 4,000 since April.

Electrek‘stake

Most of Tesla’s price increases throughout the year were smaller increases of $ 1,000 or $ 500, but they totaled large amounts.

Combined with that $ 2,000 price hike for the base versions, we’re now talking about Tesla making their vehicles significantly more expensive in the United States.

Musk claimed supply chain issues complicated matters and increased costs, which could be true, but Tesla has also gone from 19% gross profit at the end of last year to 24%. in June after the first wave of price increases. .

Tesla therefore certainly makes more money with its vehicles.

Some have speculated that these price increases in the United States will slowly raise prices in anticipation of the new federal incentive for electric vehicles.

Tesla has led the U.S. electric vehicle market for years, although its buyers no longer have access to the $ 7,500 tax credit.

A reform of the federal incentive for electric vehicles is expected to pass by the end of the year, and it could give Tesla buyers up to $ 8,000 in direct discounts in the United States.

Since demand has not been an issue for Tesla in the United States, the automaker might consider taking the opportunity to increase its gross margin to fund its growth.

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