Tesla’s big price cuts mean ‘a major shift in the EV market’

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Can Tesla remain the leader in the modern electric vehicle market it effectively created?

That question has been on the mind of EV buyers, investors, analysts, industry watchers, and Elon Musk stans for months now. That’s especially been the case as questions over demand in China and the US — not to mention the Twitter drama — seemed to cast a shadow on the electric automaker’s success story.

On Thursday night, Tesla revealed its answer to this problem, at least for now: steep price cuts on its lineup of cars, which in some cases amount to as much as 30 percent off when the latest EV tax credits are applied as well.

Moreover, some of the price cuts now qualify the cars for those tax breaks in the first place.

Analysts who spoke to The Verge on Friday stressed the significance of these cuts and said they may have profound effects not just on Tesla’s brand but on the increasingly competitive EV game. Some even said this could be the first shot in a looming EV “price war,” even as automakers struggle to source enough materials to put these cars on the road en masse.

“Tesla’s latest price cuts reflect a major shift in the EV market,” said Jessica Caldwell, the executive director of insights at the car-buying website Edmunds. “In 2023 a wave of new EV options will enter the market, but given that production will be limited for most manufacturers, Tesla is positioning itself to scoop up consumers unwilling to wait or who may be on the fence about EV technology by enticing them with one thing all buyers respond to — a deal.”

Prospective Tesla customers will likely be very happy with Thursday’s news. The Model 3 Performance, for example, dropped from nearly $63,000 to $54,000 before any tax credits. The Model Y Performance has gone down from nearly $70,000 to about $57,000, also before the tax credits.

Source: TheVerge