TESLA MODEL 3. ALEXANDER MIGL.
Tesla's Model 3 Sedan costs $4,930 less than the average new car in the U.S.
The electric vehicle (EV) maker's price drops have made its cars cheaper than they have ever been relative to gas vehicles.
On Jan. 12, Tesla slashed prices by up to 20% in the U.S. and EU in a bid to stoke demand.
- After two additional cuts, Tesla's cheapest vehicle, the Model 3, now has a starting price of $42,990.
- The Model 3 costs nearly $12,500 less than the average new vehicle sold in the U.S. when taking into account the EV tax credits enacted in January.
- The average price of a new gasoline-powered vehicle in the U.S. has risen by over $10,000 since the start of the COVID-19 pandemic.
- The increase was driven by the rising costs of raw materials, a shortage of computer chips, and decisions by manufacturers to keep prices high.
Zoom Out:
- Ford Motor Co. responded to Tesla's price cuts by reducing the price of its electric Mustang Mach-E by an average of $4,500.
- Tesla's latest price drops may allow EVs as a whole to attain price parity with their gasoline-powered counterparts.
