Tesla has introduced more affordable versions of its popular Model Y and Model 3 electric vehicles, aiming to invigorate declining sales figures. The new Model Y Standard and Model 3 Standard boast an estimated driving range of 517 kilometers (321 miles). The Model Y Standard is priced just below $40,000, featuring a simplified interior to achieve its lower cost. This strategic move comes at a challenging time for Tesla, as it grapples with an aging product lineup, intensified competition from global electric vehicle manufacturers, and consumer boycotts linked to its CEO. The market’s lukewarm reception suggests these new models may not deliver the significant sales rebound investors are seeking. The company also unveiled a cheaper Model 3 variant, available for under $37,000, with potential to drop below $35,000 for New York residents utilizing state rebates. While Tesla has long spoken of a sub-$25,000 vehicle, these ‘standard’ models are priced considerably higher. Their launch also coincides with consumer hesitations due to the recent expiration of the $7,500 federal EV tax credit. Tesla’s stock experienced a notable decline following the announcement. The updated Model Y offers a reduced range of 321 miles, fewer audio components, and a fabric interior instead of microsuede. It also omits the panoramic glass roof and a rear-seat touchscreen. In the competitive $40,000 EV segment, it faces rivals like the Ford Mustang Mach-E, Chevrolet Equinox EV, and Hyundai Ioniq 5. Similarly, the new Model 3 includes fewer features, such as reduced driving range and ambient lighting.
