For those who wish to purchase Tesla, now might be the time.
Courtesy of Tesla, Inc.
According to The Wall Street Journal, the electric car company cut prices of several models sold in the U.S. by percentages including 14% off the Model 3 sedan and nearly 20% off its baseline Model Y crossover.
The company’s share price dropped over 3% on the news on Friday, the outlet added.
Tesla has also had a rough year. It has faced a 65% drop in share price since January 2022, a record-breaking low for the company. Demand slowed down, and many, including investors and analysts, felt that CEO Elon Musk should not be spending so much time and money on Twitter and instead focus on Tesla.
Related: Tesla Investors Complain That Elon Musk Is Spending Too Much Time on Twitter — On Twitter
“In cutting the prices of its current models, Tesla is indicating that it is willing to concede some profit in order to increase sales volume,” The New York Times wrote.
Some of the cuts, depending on how many add-ons Tesla customers include with their purchases, make it possible for customers to qualify for a tax credit as per Inflation Reduction Act, the WSJ noted.
The credit gives buyers $7,500 for electric car purchases under $55,000.
Similar price cuts were done in Europe as well. Prices were also cut for Teslas sold in China.
Daniel Ives, an analyst at Wedbush Securities who follows the company, said it is “no secret that demand for Tesla is starting to see some cracks in this global slowdown,” in a text to Entrepreneur.
He called the cuts “eye-popping,” because of the amount.
“While the initial reaction to these cuts will naturally be negative on the [Wall Street] at first, we believe this was the right strategic poker move by Musk & Co. at the right time,” Ives added.
