Tesla<span class="company-name-type"> Ltd.</span> TSLA <span>-8.88%</span> According to the company's website, it has doubled the discount on Model 3 and Model Y electric vehicles delivered in the U.S. this month, which may ease concerns about cars from Elon Musk's car company.
“Delivery of a new Model 3 or Model Y between December 21 and 31, 2022 will provide $7,500 in credit and 10,000 miles of free Supercharger,” the EV maker said on its website. .
Discounts are common in the auto industry, but Tesla’s $7,500 offer stands out in this current environment. That’s because the auto industry has been able to largely withdraw such incentive programs in recent years due to a continuing shortage of cars, largely due to supply. chain constraint.
said Thomas King, president of data and analytics at JD Power. Car companies spent an average of $1,187 per vehicle on such promotions in December, according to a consumer research firm, with some Tesla rivals raising prices on some models.
Musk has frequently boasted that Tesla stands apart from traditional car companies by not relying on advertising, discounts and other marketing tools.
Tesla shares fell more than 9% in Thursday trading. Investor fears over increased competition in the electric vehicle market, concerns about weakening demand for cars due to a worsening economic outlook, and Mr. Musk’s billionaire billionaire plan to sell his $440 in October. Significant involvement in Twitter Inc. acquired in a $100 million deal. The company’s stock is on track for its biggest annual decline to date.
Tesla says prices for the new Model 3 currently start at around $48,000 and Model Y at around $66,000, though list prices may vary depending on location and other factors.
Automakers usually try to avoid offering big discounts because it can hurt their profits and brand reputation. Research shows that Tesla’s brand image has suffered in recent months. Automakers are facing regulatory troubles, and Mr. Musk is stepping into politics to try to turn Twitter around.
Tesla frequently adjusts the prices of its vehicles in response to fluctuating demand in various markets, but few companies offer discounts. I have a record in the hands of the customer.
Tesla has said it will likely fall short of its delivery target for this year, which is to increase deliveries by about 50% annually. The company attributed the decline to disruptions in its global supply chain, the temporary shutdown of its largest factory in Shanghai, China earlier this year, and increased challenges at new factories in Germany and Texas. I believe it is.
Demand for cars is softening more broadly as consumers react to the worsening economic outlook and higher interest rates. Bernstein Research said in a recent memo that the recovery in global trading volumes has stalled.
Musk has repeatedly said Tesla is limiting production, not demand.
The $7,500 credit for Model 3 and Model Y vehicles is up from the $3,750 credit Tesla offered earlier this month.
Tesla’s credit came after President Biden signed a legislative package in August that included tax incentives for EVs aimed at accelerating the transition to cleaner cars.
Earlier this week, however, the Treasury Department delayed plans to release detailed rules on battery procurement requirements that electric vehicles must meet to receive tax credits of up to $7,500.
Tesla is rushing to increase production to meet the growing popularity of electric vehicles. Automakers are producing more vehicles at existing factories, and Musk said he plans to build about 10 to 12 new factories to meet his goal of producing 20 million vehicles around 2030. He said he was looking to add.
Separately, the National Highway Traffic Safety Administration said in a notice that it had added two more Tesla crashes involving the company’s advanced driver assistance feature known as Autopilot to its list of special investigations. The U.S. motor vehicle safety regulator said both accidents occurred this month and caused minor injuries.
Email Will Feuer at Will.Feuer@wsj.com.
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