Tesla slashed prices on three of its five vehicles and its Full Self-Driving driver assistance software over the weekend.
The company cut $2,000 off the price of most versions of its entry-level Model Y SUV, high-end Model X SUV, and range-topping Model S sedan. The move brings the Model Y back to its lowest-ever starting price.
The company also modified its website to make it more difficult for shoppers to see actual prices. It now displays prices only after subtracting all possible federal and state tax incentives and removing $6,000 for “estimated 5-year gas savings.”
The New Prices
All prices include $1,650 in mandatory fees — $1,390 for delivery and a separate $250 “order fee.”
| Model | New Price | Federal Tax Rebate |
| Model Y Rear-Wheel Drive (RWD) | $44,630 | $7,500 |
| Model Y Long Range All-Wheel Drive (AWD) | $49,630 | $7,500 |
| Model Y Performance AWD | $53,130 | $7,500 |
| Model S AWD | $74,630 | None |
| Model S Plaid | $89,630 | None |
| Model X AWD | $89,630 | None |
| Model X Plaid | $94,630 | None |
The company also slashed the price of its Full Self-Driving software option to $8,000, down from $12,000 last week. Tesla also recently cut the monthly subscription price of the option in half.
Full Self-Driving does not enable a Tesla to drive itself. But it will steer, brake, and accelerate without driver input on both highways and surface streets if the driver keeps their hands on the wheels and stays ready to take over.
Tesla Reeling Amid Strategy Questions
The price cuts come after lower-than-expected first-quarter deliveries triggered a drop in Tesla’s stock price. Electric vehicle (EV) sales grew in the first quarter of 2024 but grew slowly after several years of rapid growth. Tesla saw its share of the EV market fall to 51% — down from 62% a year earlier.
Multiple media reports suggest the company has abandoned plans to build a sub-$25,000 EV known as the Model 2. Instead, company insiders reportedly say, CEO Elon Musk plans to focus the company on developing robotaxis.
Tesla plans a call to discuss first-quarter earnings with investors after the markets close on Tuesday. It could be a tense moment as Wall Street analysts have questions about the company’s strategy.
Axios reports that a Deutsche Bank Research note late last week downgraded the company’s stock from “buy” to “hold.”
Industry publication Automotive News notes that a Wedbush Securities note Friday warned, “If Tesla does not come out with a Model 2 in the next 12 to 18 months, the second growth wave will not come. Musk needs to recommit to the Model 2 strategy along with robotaxis.”
The company, meanwhile, will ask shareholders to approve the largest pay package in history for Musk at a June 13 shareholder meeting.
