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]