In an effort to reverse declining sales figures, Tesla has introduced more budget-friendly versions of its Model Y and Model 3 electric cars. These newly launched “Standard” variants offer an estimated range of 517 kilometers (321 miles) on a single charge. The Model Y Standard enters the market at a price point just under $40,000, characterized by a simplified interior design. Meanwhile, the Model 3 Standard is now available for less than $37,000, with potential savings in New York bringing the cost below $35,000 after state incentives.
This move comes during a difficult year for the electric vehicle giant. Sales have been hampered by an aging vehicle lineup, fierce competition from global automakers, and consumer backlash against CEO Elon Musk. The market’s response has been discouraging, with Tesla’s stock plummeting sharply. Observers believe the company’s investor base was hoping for a more revolutionary product introduction, not just a stripped-down version of existing popular models.
While Tesla has long spoken of developing an electric car priced around $25,000, these new “standard” models are still significantly more expensive. Furthermore, their arrival follows the discontinuation of a valuable $7,500 federal tax credit for EVs, a factor that might lead many potential buyers to postpone their purchase decisions. The updated models incorporate compromises, including a shorter driving range and fewer luxury features such as premium audio systems and ambient lighting. The Model Y Standard, for example, omits the panoramic glass roof and a second-row touchscreen. The competitive landscape for EVs in the $40,000 range is increasingly crowded, with models like the Ford Mustang Mach-E, Chevrolet Equinox EV, and Hyundai Ioniq 5 posing significant challenges.