Tesla quietly raises prices for four of its electric vehicles
Tesla quietly raised the prices of four of its electric vehicles over the weekend, days after the automaker reported a record third quarter profit of $ 1.6 billion. First reported by Electrek, the base Model 3 and Model Y electric vehicles are each more expensive by $ 2,000, at $ 43,990 and $ 56,990 respectively. Additionally, the base Model S and Model X vehicles will each cost an additional $ 5,000, at $ 94,990 and $ 104,990.
Tesla had a record third quarter despite the global semiconductor shortage that plagued other automakers. Tesla CEO Elon Musk said in June that Tesla’s incremental price hikes on the Model 3 and Y in the first half of 2021 were largely due to shortages in the supply chain. But the company was able to rewrite its vehicle’s software so that it could support alternative chips.
Other automakers, including Volkswagen, Ford and Toyota, have not been so lucky, taking steps such as raising vehicle prices and temporarily closing factories in an attempt to overcome the chip shortage.
Tesla did not provide an explanation for the latest price hikes, but the company’s chief financial officer Zach Kirkhorn said on his third quarter earnings conference call with investors that increased demand for electric vehicles “caught us a bit by surprise”.
âSometimes to the public our price changes may not make sense,â Kirkhorn said. âBut, you know, there’s a strategy that we’re working behind the scenes as we balance supply and demand, because we’re also trying to balance various parts shortages, while also trying to manage wait times. It all goes into optimization here.
Updated October 24, 2:04 p.m. ET: Added a more detailed quote from Tesla’s CFO.