Do you want a Tesla? Prices have fallen again this year.
Key Points Tesla has cut prices for the second time this year, with the cost of the high-end Model X Plaid dropping $30,000. Tesla has cut prices to protect its 65% market share in electric vehicles as competition increases and demand falls Prices also allow many buyers to qualify for the $7,500 federal tax credit.
Tesla recently announced that it would cut prices on four of its electric vehicle (EV) models for the second time this year. After the first round of price cuts in January, Elon Musk stated that interest had increased. With this second round of price cuts, he hopes to arouse even more enthusiasm among those switching to electricity. If you are one of those people then you will be pleased to know that there are now more affordable options than ever before.
Largest drop in prices for electric vehicles
The average cost of a new car hit a record high last year at $49,507. According to the Kelley Blue Book (KBB), Americans have paid more than the manufacturer’s suggested retail price (MSRP) for cars every month since July 2021. The cost of electric vehicles has also skyrocketed, with the average cost close to that of a luxury vehicle. But the average price of an electric vehicle in December was 5.5% ($3,594) lower than the previous month. The average cost of a new EV sold for $61,448 and a used one was about $42,700.
The Tesla Model 3 saw the biggest price drop in January, falling almost 17% year over year. With these new price cuts, the Model X Plaid is now $109,990, down 21% from last year, and the Model S Plaid is $109,990, down 19%. The Model S and X now start at $89,990 and $99,990 in the US, down 5.3% and 9.1%, respectively, from the last price cut. These cuts also mean that some of the models will qualify for the $7,500 federal tax credit. This lowers the price of a car loan even further.
EV competition is heating up
Tesla, which accounts for 65% of all electric cars, has now cut prices twice as demand for electric vehicles has fallen. Some experts believe that Tesla will continue to cut prices as its rivals begin to catch up. This will help boost demand and boost sales so Tesla can continue to dominate the EV market. Elon Musk stated: “People’s desire to own a Tesla is extremely high. The limiting factor is their ability to pay for a Tesla… We’ve found that even small price changes have a big impact on demand, very big.”
Price reductions are a common move used by auto companies to protect their market share. Tesla’s prices aren’t the only ones that have fallen. Prices for the Hyundai Ioniq Hybrid fell by 11%. Hyundai discontinued the Ioniq last year to focus on the next generation of electric vehicles. Even with recent rounds of price cuts, Tesla models still don’t crack our list of currently cheapest electric vehicles. Here are the most wallet-friendly EVs of 2023:
Cheapest Electric Cars2023 Chevrolet Bolt EVStarting Price: $25,600EV Range: 259 miles2023 Nissan LeafStarting Price: $28,040EV Range: 149 miles2023 Mini Cooper SEStarting Price: $29,900EV Range: 110 milesCheapest Electric SUVs2023 Chevrolet Bolt EUVStarting Price: $27,200EV Range: 247 miles2022 Mazda MX -30Start Price: $33,470EV Range: 100 miles2023 Hyundai Kona ElectricStart Price: $33,550EV Range: 258 miles2023 Kia Niro EVStart Price: $39,450EV Range: 278 miles
Electric vehicles are becoming increasingly popular as prices fall and ranges increase. If you’re looking for an affordable EV option but don’t want to sacrifice performance or features, you’ll find plenty to choose from out there – whatever your budget or needs! From Tesla’s Model 3 to Nissan’s Leaf Plus or Hyundai’s Kona Electric, there are now more options than ever when it comes to going electric.
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