Tesla Greets New Year With Price Cuts, Lower-than-expected Q4 Deliveries

Steph Willems
by Steph Willems
tesla greets new year with price cuts lower than expected q4 deliveries

The calendar reads 2019, meaning new Tesla customers can’t hope to wrangle more than $3,750 in EV tax credits from the feds — a figure that’s half as much as the incentive enjoyed by buyers up until New Year’s Eve. Of course, you may find yourself living in a state that’s happy to hand out some of its own cash. If so, lucky you.

Looking to soak up some of the difference, Tesla announced a price cut on all models Wednesday. Going forward, or at least until CEO Elon Musk decides otherwise, Tesla is shaving $2,000 from sticker prices across the board — including on the current cheapest model, which recently saw a price bump.

Getting into a Mid Range Model 3 now carries a cost of $44,000 before federal incentives, which brings it sooo close to dropping below the $40k threshold.

You’ll recall that Tesla introduced the rear-drive model with a $45,000 asking price last October, undercutting the price of the Long Range model by $4,000 (by having it travel 50 fewer miles on a charge). Shortly after its introduction, Tesla hiked the Mid Range’s price by a grand.

That price change coincided with the elimination of the rear-drive Long Range model (then priced at $49,000), making the dual-motor, all-wheel drive version the next rung up on the Model 3 ladder. Depending, seemingly, on the time of day, that car’s price stood at $54,000 or $55,000. Not anymore — it’s now $51,000. The dual-motor Performance model will set you back $62,000 before incentives.

As for the company’s Model S and X line, well, it’s more of the same, though their lofty prices water down the significance of manufacturer or government incentives.

Wednesday wasn’t all about price changes, however. In a filing to the U.S. Securities and Exchange Commission — a body Musk openly loathes — Tesla announced fourth-quarter production figures of 86,555 vehicles, making it the busiest quarter for the automaker to date (an 8 percent increase over Q3). It was also less than what analysts predicted. This, plus the price cuts, sent Tesla shares tumbling in Wednesday trading.

Of the Q4 tally, 61,394 vehicles were Model 3 variants, which works out to an average production rate of just over 4,700 vehicles per week. Model 3 deliveries were up 13 percent over the previous quarter. Still, as CNBC reports, Wall Street predicted nearly 65,000 Model 3 deliveries.

While Tesla’s Q4 figures reveal steady improvement, it’s hard not to think back on the hype-building production promises issued by Musk over the past couple of years. Half a million cars built in 2018? That was a promise, once upon a time, but reality shows just 245,240 vehicles delivered last year. 10,000 Model 3s per week by the end of 2018? That was another.

Meanwhile, the $35,000 base Model 3 promised in 2016 remains out of reach, though production is said to begin in the first half of this year.

“There remain significant opportunities to continue to grow Model 3 sales by expanding to international markets, introducing lower-priced variants and offering leasing,” the company stated in its filing. “International deliveries in Europe and China will start in February 2019. Expansion of Model 3 sales to other markets, including with a right-hand drive variant, will occur later in 2019.”

[Image: Tesla]

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  • Speedlaw Speedlaw on Jan 02, 2019

    If you need to spend time doing something silly, go to Twitter and search #SGF and #SAF. You will fall into the tweets of the shorts.....who do things like count cars on lots and amplify every negative Tesla experience into gospel. I've very entertained (popcorn emoji here) but wouldn't buy a Tesla due to the legit spare parts issues and the scary way some of the cast alum suspension members snap. I think EV has a place and if I didn't do 400 mile days for work a few times a year I'd consider one. Again, these Twitter feeds are done with a clear financial goal, but they are still entertaining-not facts. Counting cars is pretty much meaningless...a lot of what they do would make zero sense and result in no real info applied to, say, GM or Toyota.

  • Incautious Incautious on Jan 03, 2019

    But but but there's 420,000 reservations, no need to cut prices.

    • See 1 previous
    • Giskard Giskard on Jan 03, 2019

      You are aware that their reservation count includes people waiting for the short range version and those in countries that aren't the USA or Canada? None of these have gotten their car yet.

  • KOKing I car-sat an A32 while its owner was out of the country, and the then whiz-bang VQ motor was great, but the rest of it wasn't any better than a XV10 or XV20. Definitely the start of its downward slide, unfortunately.
  • Norman Stansfield Why are leaf springs still a thing on this truck?
  • Syke The expected opening comments. Have had mine for two years now, the car has done exactly what I want out of it, and a little better. I'm quite happy with the car, haven't had to adjust my driving style or needs in the slightest, and . . . . oh, did a mention that I don't give a damn what today's price at the pump is?Probably going to go for a second one in the coming year, the wife's happy enough with mine that she's ready and willing to trade in the Nissan Kicks. Eventually, the not often used van will end up getting traded on a Chrysler Pacifica Hybrid, basically ensuring that we don't use gas for anything except the occasional long trip.And the motorcycles.
  • Bobbysirhan I've never found the Allegro appealing before, but a few years of EV rollouts make it seem downright desirable.
  • Scoutdude I know that dealership. Way back when my friend's grandfather was that Turner that owned the Chrysler Plymouth International dealer, in MacPherson. Of course the International was dropped when they didn't deem the Scout reason enough to keep the franchise. I moved from there in late 1978 so it is possible I saw this running around town way back when.
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