Tesla raises prices on Model S and X in U.S. as company faces stock market challenges
After facing a decline in profitability and stock value, Tesla has raised the prices of its high-end Model S and X vehicles in the US. Each variant of the models has been increased by $2,500, resulting in a 2% to 3% price hike for the sedan and SUV. The updated starting prices for the Model S and X are $87,490 and $97,490, respectively.
Tesla has lowered the prices of its Model Y SUV and Model 3 sedan for the second time this month, while raising the cost of its Model S and X vehicles. The adjustments came after CEO Elon Musk suggested that the company will continue cutting prices to increase demand, and Tesla's shares experienced their biggest drop since January 3rd as a result. Despite this, the stock rebounded slightly before the start of trading on Friday.
The company recently started exporting Model S and Model X vehicles again from its California car plant, even though they are of minor importance to Tesla’s future, according to Musk. Tesla's Q1 sales of Model S and X were just 2.5% of total deliveries, so adjusting prices for these higher-end vehicles is less impactful to the bottom line. However, the automotive gross margin excluding sales of regulatory credits dipped to 19%, below the 20% threshold expected for this year, with the operating margin at a two-year low of 11.4%.
The moving assembly line innovation by Ford in the early 1900s led to other carmakers going out of business, as it allowed for cost reduction to levels that competitors could not match. Tesla, with its unique position among EV makers, has been compared to Ford's early days.
2023 Tesla Model X: What You Need to Know
|2023||Hatchback, SUV||Model X||348||$79,990|