Tesla has again reduced the price of the basic version of the Model S, possibly in reaction to the prices that were just revealed for the competing Lucid Air.
Now the Model S Long Range Plus is slightly cheaper in the USA than the announced basic model of the Lucid Air after tax credit deductions. After Tesla had reduced the price for the Long Range Plus and Performance versions in the USA at the beginning of this week by $3,000 each to now $71,990 and $91,990 respectively, now there is also a further reduction for the basic Long Range Plus version to $69,420.
Although Elon Musk did not mention Lucid by name when announcing the new Model S price on Twitter, the reference was still quite clear:
The gauntlet has been thrown down!
The prophecy will be fulfilled.
Model S price changes to $69,420 tonight!
— Elon Musk (@elonmusk) October 14, 2020
Lucid has only just revealed the price and some performance data for the basic model of his electric sedan. The car, called Lucid Air, is listed at $77,400. Since Lucid Motors has not yet delivered any electric cars to customers, Lucid Motors’ electric cars are still entitled to the full tax credit of $7,500, bringing the entry price down to $69,900 – a value that Tesla is now undercutting by $480. Tesla has already sold more than the given quota of electric cars in the US and has lost its eligibility for tax credits.
Until the first price reduction a few days ago, the Model S Long Range Plus in the US was priced at $74,990 in the Tesla configurator. Since then the price has dropped by $5,570 or 7.4 per cent. At the time, the price for the performance model fell from $94,990 to $91,990; this version is not affected by the second price reduction. Also for the announced plaid model with three electric motors and some other changes, the price is still 139,990 dollars.
In the USA, media outlets are speculating whether the second Tesla price reduction makes any sense at all. InsideEVs, for example, asks whether the price competition is already necessary at this point when the basic version of Lucid Air won’t even be out until 2022. Next year, the higher-priced versions will be delivered first. Fred Lambert from Electrek also refers to the expected delivery in 2022, saying that he does not think the prices will make a big difference to Tesla until Lucid starts delivering the Lucid Air. He says that, instead, “What Model S really needs is an interior refresh — something Tesla has been delaying since last year.”
In Germany, the Model S Longe Range is listed at 76,990 euros, which still corresponds to the level of the last price reduction at the beginning of this week. The price may also soon be further reduced in Europe.
A change in the Model Y is already certain: Musk also announced that the seven-seater version of the smaller e-SUV would go into production in November and be delivered from December onwards. In the USA, the seven-seater is to cost 3,000 dollars more, and in Germany, for example, this variant will be 3,100 euros more expensive. In both cases, however, Tesla still points out that the seven-seater interior is to be available “from 2021” onwards.
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