Tesla Cuts Model S Price By $3,000, Model X By $2,000

Palo Alto slashed $3,000 off the Model S, translating to $75,000 before savings for the sedan. Tesla is known to adjust the pricing of the full-size lineup from time to time, but on the other hand, remember what happened in April 2019. Without further beating around the bush, these adjustments offset the increases brought by the longer range, different drive system, and upgraded suspension.

Tesla hasn’t commented if slowing interest had something to do with these $3,000 and $2,000 adjustments, but we all know the answer to that question. Elon Musk is under pressure to keep the EV automaker profitable while growing the business, and that’s a serious undertaking given how many things are being developed in the background.

The Roadster II, Semi, pickup truck, Model Y, and self-driving system come to mind, along with the Gigafactory in Shanghai. Ever since the beginning, the fundamentals of Tesla’s business have been uncertain to most investors with more sense than green dollar bills.

After a couple of layoffs and the closure of physical stores, it’s likely that Tesla is running on a tight budget to make ends meet this quarter. No fewer than $702.1 million were lost in Q1, and investors weren’t happy with this result. Adding insult to injury, sales took a turn for the worse in the first quarter. By 31 percent to be more precise, and the second quarter of the year wasn’t too rosy either.

Another hiccup for Tesla comes in the guise of the $7,500 federal tax credit. The U.S. government will phase out this incentive for Tesla by the end of the year, and that’s certain to drive down demand as the price increases across the lineup.

The Model 3 remains the most affordable option at the present moment at $39,900 before savings for the Standard Range Plus, translating to $36,150 including the $3,750 federal tax credit.