Tesla lowered prices by $2,000 on three of its five models in the United States late Friday, signaling ongoing challenges for the electric vehicle manufacturer led by billionaire Elon Musk. The price cuts affected the Model Y, Tesla’s popular small SUV and the best-selling electric vehicle in the U.S., as well as the older and pricier Models X and SThe prices for the Model 3 sedan and the Cybertruck remained steady.
Following the adjustments, the starting price for a Model Y dropped to $42,990, while a Model S now starts at $72,990 and a Model X at $77,990.
These adjustments came on the heels of Tesla’s stock plummeting below $150 per share, erasing all gains made over the past year.
The company’s stock has fallen approximately 40% this year due to declining sales and heightened competition. Lowering prices is a strategy to attract more car buyers amidst these challenges.
On Saturday morning, Musk took to X, formerly known as Twitter before his acquisition and renaming of the platform, to announce that factoring in federal tax credits and gas savings, the entry-level Tesla could be as affordable as $29,490.
Industry analysts had anticipated Tesla’s release of a small electric vehicle priced around $25,000, dubbed the Model 2. However, media reports earlier in the month suggested Musk intended to abandon the project, leading to uncertainty about the company’s trajectory, although Musk refuted these claims as false.
The price adjustments marked the end of a challenging week for Tesla. On Monday, the company announced a global workforce reduction of 10%, affecting around 14,000 jobs.
Additionally, Tesla disclosed a recall of nearly 4,000 of its 2024 Cybertrucks due to a discovered issue with the accelerator pedal, which could potentially lead to unintended acceleration and an increased risk of crashes.
Musk announced on Saturday that he had delayed a scheduled weekend journey to India to meet with Prime Minister Narendra Modi, attributing the decision to “very heavy Tesla obligations.” He expressed anticipation for rescheduling the visit later in the year via X.