Tesla is offering discounts for Model 3 and Model Y up to $7,500 in the US for this month. Amid the concerns about the automaker softening demand, the price decrease appears to take steps accordingly. The discount is up from the initial $3,750 discount that was offered on the vehicle before the end of the year.
It has also recently started offering free supercharging for 10,000 miles (16,093 km) for vehicles delivered in December. The latest discount came just days after the U.S. Treasury Department delayed restrictions on EV incentives until March, meaning Tesla and other U.S.-made electric vehicles will be likely to qualify for the full $7,500 in incentives starting January.
Customers had canceled their orders and held off their purchases until the new credits take effect in January, weighing on Tesla demand. Analysts also worry that rising interest rates and Chief Executive Elon Musk’s Twitter distraction could hurt the Tesla brand and sales. “The fact they seem to be cutting the price to increase delivery volumes doesn’t raise confidence, particularly at a time where we see increasing competition,” Craig Irwin, a senior analyst at ROTH Capital Partners, said.
Discounts
The rare discounts follow a series of price hikes over the past couple of years by the automaker, which blamed supply chain disruption and inflation. Tesla’s shares, which have lost over two-thirds of their value so far this year, were down 5% at $130.60 on Thursday.
Tesla is also offering a $5,000 credit in Canada on Model 3 and Model Y vehicles delivered before the end of the year. The U.S. automaker has also given a discount of 6,000 yuan ($860) on some models in China until the end of 2022. Tesla said in October it would miss its vehicle delivery target this year, but downplayed concerns about demand after its revenue missed Wall Street estimates. ($1 = 6.9761 yuan). Analysts also worry that rising interest rates and Chief Executive Elon Musk’s Twitter distraction could hurt the Tesla brand and sales. “The fact they seem to be cutting the price to increase delivery volumes doesn’t raise confidence, particularly at a time where we see increasing competition,” Craig Irwin, a senior analyst at ROTH Capital Partners, said.
