Almost Like a $35,000 Car…

Steph Willems
by Steph Willems
almost like a 35 000 car 8230

Thus far in 2019, price changes at Tesla have occurred with roughly the same frequency as storm warnings in the Northeast. The electric automaker has now dialed back pricing on its Model 3 for the second time this (very young) year, and the third time in recent months, with the company’s CEO claiming the long-promised $35,000 sedan is now here — in a way.

Fancy math required.

Actually, the Model 3’s entry price has seen almost continuous alterations, the most notable being after the late-2018 introduction of a Mid Level version with 260 miles of range. It’s this vehicle which Tesla just pared back by $1,100, putting its entry price at $42,900.

But wait! There’s still a halved federal tax credit for buyers who stake their claim before July 1st, so knock another $3,750 off that sticker. Thus, $39,150 becomes the Model 3’s floor for the next four and a half months. Unfortunately, as Tesla continues the annoying habit of factoring anticipated gas savings into its pricing, we’re left with statements like this:

Model 3 starting cost now ~$35k (after ~$8k of credits & fuel savings)

— Elon Musk (@elonmusk) February 6, 2019

Of course, drivers of gasoline-powered cars can also save on pump costs — by keeping a bicycle handy and ignoring the freshly purchased vehicle sitting in their driveway. It’s a weird way of calculating price, one practiced by no other player in the EV field.

Anyway, the dream of a Model 3 that actually costs $35,000 remains alive, with Musk saying during a recent earnings call that the base model should appear by summer. That means a full three-year wait for those lured in during the model’s launch in summer, 2016.

In the meantime, Tesla remains on a cost-cutting kick, purging employees in a bid to boost profitability. The newly reduced Model 3 price is a result of the company’s decision to axe its customer referral program, Tesla claims.

Studies have shown Tesla employs far more workers to build fewer vehicles than “legacy automakers,” hurting its balance sheet, and the push is on to achieve economies of scale necessary to build a cheaper Model 3 variant.

During the Q4 2018 earnings call, Bloomberg reports, Musk stated, “Getting those costs down — variable costs and fixed costs — is what allows us to lower the price and be financially sustainable and achieve our mission of environmental sustainability. We have to be absolute zealots about this, there’s no question.”

[Image: Tesla]

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4 of 58 comments
  • Incautious Incautious on Feb 07, 2019

    with the huge hike in price at a supercharger, it can cost more to fuel up a tesla than a fuel efficient ICE

    • HotPotato HotPotato on Feb 09, 2019

      Superchargers aren't for routine fueling, they're for road trips. The point of instituting a charge there was to stop the a-holes who did all their routine charging there instead of charging at home on their own dime.

  • Arthurk45 Arthurk45 on Feb 07, 2019

    Musk's "fuel costs savings" are bogus in a variety of ways. Number 1 : a gallon of gas contains a significant road tax, which is not a fuel and which electric cars will have to pay, probably sooner rather than later. Gas prices are fairly consistent across the country, but electric costs vary wildly - people in California can pay 4 times more than folks in the midwest. And mileage for an electric car varies widely with the seasons - figure 40% or more worse mileage in the cold. Also, those who can't recharge at home and have to use the Superchargers (or live in NY, HAwaii or parts of California) will pay more for fuel than any gas powered vehicle. Tesla cars also lose their current $3750 govt tax credit in just a few months,and all credits by the end of 2019. Musk is not only a conman, he is quite stupid, actually.

    • SCE to AUX SCE to AUX on Feb 07, 2019

      You're improving. Only half of what you said here is wrong.

  • 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.