One of the big benefits of buying an EV in the US is that the federal government has been offering massive tax credits to get buyers to adopt the cars. The problem for Tesla is that there was a limit on how many cars you can sell before those tax credits are reduced and eventually end. Tesla hit the reduction mark by delivering its 200,000th vehicle last year.
To keep buyers looking at its EVs rather than the competition, Tesla has cut prices to make the cars more appealing with the tax incentives being phased out. Each of the Tesla vehicles is now $2,000 cheaper than before.
The Model 3 now starts at $44,000 with the mid-range battery. The Model S now starts at $76,000, and the Model X starts at $82,000. The price cuts don’t make up for the loss of the $7,500 tax credit, but it helps. Buyers will get a $3,750 tax credit as of January 1 through July 1, when it gets cut to $1,875.