Tesla cuts $ 4000 on the price of Model 3 with a new mid-range battery

Tesla Inc. has started selling a cheaper version of the Model 3 sedan on Thursday, but the price is still higher than originally promised and federal tax incentives that could lower the price are bound to expire.

The new version features a new mid-range battery and a starting price of $ 45,000, the electric car maker said late Thursday – $ 4,000 less than the previous initial price of $ 49,000. For more than a year, Tesla

TSLA, -2.90%

has advertised any Model S with a base price of $ 35,000 that will be accessible enough to attract the masses, but is not yet available.

In August, UBS analysts said Tesla would lose money on a Model 3 with a base price of $ 35,000. The Tesla website says that the standard version, which should have that base price, will start selling between four and six months.

In a tweet on ThursdayTesla's CEO, Elon Musk, has claimed the new model "It costs $ 35k after federal and state tax rebates in California, but the real cost of ownership is closer to $ 31k after gas savings."

However, the tax rebates that apply to everyone in the United States are expiring – as Tesla has reached a key delivery threshold, the $ 7,500 federal electric tax credit for electric vehicles will be phased out as of 2019. For buyers who take delivery from 1 January until 30 June 2019, the credit will fall by half to $ 3,750, and will fall again by half for the period from 1 July to 31 December 2019, then completely eliminated in 2020.

Tesla plans to start delivering Model 3 with the new mid-range batteries in six to 10 weeks, the company said.

"As Model 3 production and sales continue to grow rapidly, we have achieved a consistent volume of production capacity, allowing us to diversify our product offering to even more customers," a Tesla spokesperson said in a statement. . "Our new mid-range battery will be introduced this week in the US and Canada to better meet the diverse coverage needs of numerous customers who want to own Model 3."

The new version has a range of 260 miles, Tesla said on its website, compared to the previously available 310-mile long-range battery pack. Musk has added on Twitter that long-range batteries, rear-wheel drive and "full self driving" will only be available next week and will be "off-menu" options.

The Tesla stock has fallen by 15.2% this year, as is the S & P 500 index

SPX, -1.44%

it gained 3.6%.


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