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Tesla Introduces Affordable Model Y Following Q3 Delivery Shortfall

Tesla Introduces Affordable Model Y Following Q3 Delivery Shortfall

Tesla, Inc. (TSLA) has introduced a new variant of the Model Y in the United States, which is priced $3,750 lower than the previous base model. This announcement followed Tesla’s report of a larger-than-expected decrease in third-quarter deliveries.

On Monday night, Tesla unveiled a rear-wheel-drive Model Y priced at $43,990, boasting an official range of 260 miles, as per the company’s website. Deliveries for this model are scheduled to commence in October-November.

The former base Model Y with 4680 cells, previously priced at $47,740, is no longer available. The dual-motor Long Range and Performance variants now start at $50,490 and $54,490, respectively.

Notably, Tesla had been selling a rear-wheel-drive Model Y in China and Europe for a considerable period. Over the weekend, Tesla made slight updates to the rear-wheel-drive Model Y in China.

In the United States, Tesla briefly offered a rear-wheel-drive Model Y with a 244-mile range, but this variant was swiftly discontinued in 2021.

While the introduction of a more affordable Model Y is expected to boost sales volumes, it also suggests ongoing pressure on selling prices and profit margins.

Regarding Tesla’s deliveries, the company reported that it delivered 435,059 vehicles in Q3, reflecting a 6% decline compared to the record 466,140 deliveries in Q2. This figure fell short of analysts’ expectations, who had anticipated around 455,000 deliveries. Consensus estimates had been revised down from approximately 470,000 just a few weeks earlier.

Tesla attributed the reduction in production during Q3 to factory upgrades, but high inventory levels likely played a role as well.

In the fourth quarter, Tesla is set to begin deliveries of the updated Model 3 and potentially the Cybertruck.

Tesla’s stock, TSLA, initially experienced a decline on the news of weaker deliveries but later rebounded to close up 0.55% at $251.60. Investors are looking ahead to a potential Q4 delivery recovery and are optimistic about Tesla’s self-driving and artificial intelligence prospects.

Tesla’s stock closed just above the 50-day moving average and is currently working towards a cup-with-handle buy point of $278.98, according to MarketSmith.

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Topics #Electric Vehicles #EV Market #Q3 Deliveries #Tesla Model Y #Tesla Price Cut #Tesla Sales Strategy #Tesla Stock