Published: Thu, February 07, 2019
Business | By Eloise Houston

Tesla cuts Model 3 price again as tax credit is phased out

Tesla cuts Model 3 price again as tax credit is phased out

With those included, Tesla says, the price is $34,850.

The long-promised $35,000 Tesla Model 3 is still a few weeks away from production, but it remains to be seen if it will, in fact, cost buyers $35,000.

A US federal tax credit began phasing out for Tesla in January, effectively raising the price of cars by $3,750.

In an effort to lower the price of the vehicle, Musk, who is also the founder of rocket company SpaceX, has slashed more than 3,000 jobs and ended a customer referral program. Tesla continues to display model pricing with incentives and fuel savings on its site, which is not a great thing to do when it comes to advertising given the fact that customers will certainly be paying thousands more out the door and will notice that they're paying thousands more.

The incremental reductions in price are the result of a war Tesla's team is waging on bringing costs down.

Amid losing a tax credit that made its cars more affordable to buyers in the U.S., Tesla has today announced that it is cutting the price of its Model 3 sedan for the second time this year, Reuters is reporting.

"The demand for - the demand for Model 3 is insanely high".

Speaking at Tesla's Q4 2018 earnings call last week, the CEO said that, "We're reducing our costs while making nuanced improvements to the Model 3. It's just like people literally don't have the money to buy the vehicle", Musk during the company's earnings call last week.

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