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Business News/ Companies / News/  Tesla knocks $2,000 off prices for 3 EVs after shares crash 39% YTD on falling sales
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Tesla knocks $2,000 off prices for 3 EVs after shares crash 39% YTD on falling sales

The move came the day after Tesla's stock tumbled below $150 per share, eliminating all gains made over the past year.

FILE PHOTO: The company logo is pictured on a Tesla Model X electric car in Berlin, Germany, November 13, 2019. REUTERS/Fabrizio Bensch/File Photo (REUTERS)Premium
FILE PHOTO: The company logo is pictured on a Tesla Model X electric car in Berlin, Germany, November 13, 2019. REUTERS/Fabrizio Bensch/File Photo (REUTERS)

Tesla knocked $2,000 off the prices of three of its five models in the United States late Friday, another sign of the challenges facing the electric vehicle maker led by billionaire Elon Musk. The company cut the prices of the Model Y, a small SUV which is Tesla's most popular model and the top-selling electric vehicle in the US, and also of the Models X and S, its older and more expensive models.

Prices for the Model 3 sedan and the Cybertruck stayed the same. The cuts reduced the starting price for a Model Y to $42,990 and to $72,990 for a Model S and USD 77,990 for a Model X.

The move came the day after Tesla's stock tumbled below USD 150 per share, eliminating all gains made over the past year. The Austin, Texas, company's stock price has dropped about 40 per cent so far this year amid falling sales and increased competition. Discounted sticker prices are a way to try to entice more car buyers.

Musk posted early Saturday on X, the social media platform known as Twitter before he acquired and renamed it, that the cost of an entry-level Tesla was as low as USD 29,490 once a federal tax credit and gas savings were factored in.

Industry analysts have been waiting for Tesla to introduce a small electric vehicle that would cost around USD 25,000, the Model 2. Media reports this month that Musk planned to scrap the project created more uncertainty over the company's direction, although Musk called them untrue.

The price cuts ended a long workweek at Tesla, which announced Monday that it was cutting 10 per cent of its staff globally, about 14,000 jobs. The company also said it was recalling nearly 4,000 of its 2024 Cybertrucks after discovering the accelerator pedal can get stuck, potentially causing the vehicle to accelerate unintentionally and increase the risk of a crash.

On Saturday, Musk confirmed he had postponed a planned weekend trip to India to meet with Prime Minister Narendra Modi, citing “very heavy Tesla obligations." He said on X that he looked forward to rescheduling the visit for later this year.

Tesla is scheduled to announce its first-quarter earnings on Tuesday. The company reported earlier this month that its worldwide sales fell sharply from January through March as competition increased worldwide, electric vehicle sales growth slowed, and earlier price cuts failed to lure more buyers. It was Tesla's first year-over-year quarterly sales decline in nearly four years. 

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Published: 20 Apr 2024, 10:52 PM IST
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