Tesla, recently, has sparked a bit of a price war in the EV sphere, after cutting prices on some of its cars in January. The strategy may be due to some kind of tax incentive alchemy or simply to induce more demand, since Teslas are no longer the only EV game in town, nor even close to the best. In the past couple days, Tesla has lowered the price of its Model S and Model X, Reuters reports.
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The price cuts will mean nothing to anyone who’s not in the market for a Model S or Model X, which is the vast majority of people; those top-tier models made up a mere four percent of Tesla’s global deliveries in 2022. And yet, for anyone looking for weakness in Tesla, or for any other mildly-curious observer of the EV market, it is telling of something that Tesla thinks it can’t sell the Model S and Model X for what it used to. From Reuters:
Tesla’s website showed it had cut prices on both versions of its Model S by $5,000. The basic version of Model S was cut by 5% to $89,990, while the price of the performance, Plaid variant was cut by 4% to $109,990.
Prices of both the performance and basic variants of Model X cars were cut by $10,000, the electric vehicle maker’s website showed. The price of the basic, AWD version of the Model X was cut by 9% to $99,990 while its performance Plaid version was cut by 8% to $109,990.
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The across-the-board discounts are especially surprising given CEO Elon Musk’s past comments expressing disgust at the idea of cutting prices. As Torque News reminds us, in 2016, Musk sent a directive to Tesla employees stating, “There can never — and I mean never — be a discount on a new car coming out of the factory in pristine condition.”
Tesla CEO Elon Musk doesn’t believe in model years, even though Teslas do get updated. But this seems like, too, an admission that the Model S and Model X are what they are, which is, old products.