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Tesla Offering Big Discounts a Week After Raising Model Y Price

by | April 5, 2024

In mid-March, Tesla officials warned a $1,000 price increase would be applied to the Model Y on April 1 — and they made good on it. Just four days later, the EV maker is offering big discounts on several vehicles, hoping to shed excess inventory.

Tesla’s offering big discounts on new vehicles it has sitting in inventory, including discounts on Model Ys for more than $7,500.

Tesla’s long been known for cutting and raising prices, hoping to stimulate sales. However, these changes typically come near the end of a financial quarter as the company looks to either set a new record or at least deliver more vehicles than the year-ago period.

However, things have changed.

The company reported it had more than 46,000 new, unsold vehicles in its inventory as of the end of the first quarter of this year. Officials are looking to move some metal.

Big cuts

The Model Y vehicles in inventory are now be offered with much bigger markdowns. Some versions of the Model Y rear-wheel drive can be had for as much as $7,520, according to Electrek. This is reportedly before the federal and state tax credits.

Tesla Model 3 updated pair

Tesla sales rose 38% last year – but were expected to climb 50%.

The long-range and performance Model Ys are discounted by at least $5,000. These discounts are before any federal or state tax credits are applied. The rear-wheel drive Model 3 is also down as much as $4,000. A dual motor, all-wheel Model S demo model has received a more than $8,200 discount.

Sales were down on a year-over-year basis for the first time in nearly four years.

The EV maker produced 433,371 vehicles and delivered 386,810 vehicles. The deliveries were down 8.5% compared to the same quarter last year. Analysts predicted delivery totals ranging from 449,080 to 454,200 vehicles.

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Other makers

While Tesla’s looking entice buyers to clear out its inventory with big price cuts, other automakers are selling in big numbers. For example, Kia’s sales of electrified models in March grew 9% compared to the previous year. Specifically, EVs saw a significant increase of 151% over the previous year.

2021 Tesla Model S driving red

Price cutting contributed to a 50% decline in 4th quarter margins.

Hyundai set total and retail sales marks in Q1 for Ioniq 5, Tucson PHEV, Tucson HEV, Kona EV and Palisade. EV sales for the quarter jumped 62% compared to Q1 last year. Ioniq 5 sales in March were up 58% and its overall EV sales were up 100% for the month.

Across Ford electric vehicles, sales started the year strong, up 86%. Ford sold 20,223 EVs in Q1, making Ford America’s second best-selling EV brand behind Tesla for the quarter. Mustang Mach-E posted strong Q1 sales of 9,589 SUVs – up 77% over a year ago.

The F-150 Lightning, reported sales of 7,743 trucks, up 80%. Meanwhile Ford E-Transit was America’s best-selling electric van on sales of 2,891 — up 148% over Q1 last year. It was the best-ever sales quarter for E-Transit since it went on sale in 2022, the company said.

Honda, Toyota, Subaru and others also reported substantial EV sales increases during the first quarter.

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