Tesla also slashed the price of its flagship sedan, the Model S, by $10,000, starting at $96,630, including shipping and ordering fees. The Model X midsize crossover has been slashed from $111,630 to $11,000. None of these midsize Tesla vehicles are eligible for the tax credit, according to the Inflation Reduction Act guidance, and for SUVs and trucks he runs up to $80,000.
Tesla already had a large share of the EV market before the price cut, according to Experian new car registration data from January to November 2022.
Tesla’s U.S. EV share fell to 64% in the 11-month period from 70% the year before, but the company’s new vehicle registrations rose from 303,129 to 431,740 as the EV market expanded rapidly last year. .
Tesla doesn’t disclose its U.S. sales performance, so experts have to use registration numbers and other data to extrapolate the company’s deliveries.
The price cuts have also spurred search results for current Tesla owners trying to figure out how much their used cars have fallen in value.
“Valuations skyrocketed as current Tesla owners wanted real-time updates on how the cuts would affect the value of their vehicles,” Edmunds said. According to his January 13 search data, when Tesla announced the price cut, Tesla’s valuation more than tripled his, up from 0.8% the day before to 3.1% for him.
Edmonds said Tesla’s used car prices had already fallen precipitously because it remained in dealer lots.
“Edmonds analysts said the slowdown was due to a combination of unique factors, such as car flippers jumping into the market when used prices peaked, followed by lower used prices and rising interest rates, driving down residual values and demand. It points to a combination of the Elon Musk acquisition of Twitter and the incentives that Tesla introduced in November and December,” the company said.