Tesla and Rivian have gotten the scissors out again, cutting prices on their new offerings. The reductions are temporary for Tesla while Rivian’s cuts are designed to help offset being ineligible for part of the $7,500 federal tax credit.
The EV leader, Tesla cut $1,000 off the price of the Model Y Long Range and rear-wheel drive versions. This dropped prices to $47,990 and $42,990, respectively. The performance version of the Model Y didn’t receive a cut.
However, buyers are going to have to act quickly as new owners must take delivery by Feb. 29. Prices are going back up March 1. Tesla slashed prices of the Model Y in Germany last month. The cuts came after it suspended production at its Berlin gigafactory after attacks in the Red Sea cause parts disruptions.
Tesla CEO Elon Musk told analysts he believes 2024 would be tough year, in terms of sales growth. New EV sales have flattened out during the past nine months, plus the company is focusing on the development of its next-gen EV, dubbed “Redwood.”
The company is also looking to ramp up production of its long-awaited Cyber truck as well.
Investors have been worried about the company’s profit margin since Musk began a regular series of price cuts in 13 months ago, and the stock price suffered for a period of time.
It’s down nearly 20% during the past six months. However, the news of today’s cuts hasn’t bothered early traders, the stock price is up slightly.
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While Tesla’s cuts seem to occur on the regular, Rivian’s reductions are three times larger than Tesla’s at $3,100 for base models of its R1T pickup and R1S SUV. The base model travels 270 miles on a charge, but it added a larger battery, getting 315 miles of range, for the original prices: $74,800 and $79,800 delivered.
The R1T pickup with dual motors and the standard battery now starts at $71,700 with shipping, and the R1S in the same configuration starts at $76,700. Rivian said the models qualify for a $3,750 federal tax incentive, which is half the maximum. On a lease, the models qualify for the full $7,500, the automaker said. The company says an R1T leases start at $559 a month.
The move comes as the company readies to introduce its next line of vehicles, the R2, on March 7. Smaller than the existing R1T pickup and R1S SUV, the R2 models also will be more affordable, officials last year indicating they could start around $40,000.
The automaker has yet to provide specific details on where that unveiling will take place. Also yet to be revealed: the production schedule, though it’s widely expected we may not actually see the new line-up reach showrooms for a year or more.