Tesla is finally making a lower-cost Model 3

Gladys Abbott
October 19, 2018

Tesla has reshuffled its Model 3 lineup and is now offering the cheapest version yet, but it's still $10,000 more than the long-promised $35,000 entry-level vehicle. But Tesla has struggled to ramp up production on the Model 3 and initially focused on making the higher-end versions. It is not clear how numerous more than 400,000 reservations for the Model 3 are for the base models.

Tesla late on Thursday started accepting orders for a more affordable Model 3 Mid Range sedan for buyers in the United States and Canada. But in California, it will cost $US35,000 after federal and state tax rebates, Musk said.

Tesla has been dogged by delay and delivery issues in the past.

When the more affordable Tesla sedan launched past year, pricing started at $49,000 for 310 miles of range, which was well above the $35,000 long-range EV the company promised.

While the mid-range option is built with the same battery pack as the long-range Model 3, which has a range of up to 310 miles, the pack will have fewer cells, translated to a shorter range of 260 miles. On that page, customers can choose one of three versions of the Model 3 - the top-of-the-line performance version, the long-range battery one, and the new midrange battery variant.

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The only available Model 3 for the previous year has been a long-range version, offered mostly at luxury prices.

With the arrival of the Model 3 Mid Range model, Tesla will no longer sell the rear-wheel drive Long Range version.

Even the new version, though, doesn't fulfil the company's promises. Any new Tesla delivered after January 1st 2019 (but before July 1st 2019) is only eligible for a $3,750 IRS credit. For example, NY offers a further $2,000 incentive, dropping the price down to $35,500.

The cheaper "standard-range" Model 3 is still absent from the new, simplified ordering page, and the company has made no secret of the fact that it can not afford to lose money selling the cheaper cars, no matter the demand. But in the meantime, the electric-car maker is taking orders for a mid-range battery Model 3 that's edging closer to that sticker price.

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