Tesla Model 3 Long Range price increases, bringing it on par with the cost of the Model Y. This is the second price hike for the electric vehicle this month.

Presently, Tesla exclusively manufactures a base Model 3 Rear-Wheel-Drive Standard Range and a Model 3 All-Wheel-Drive Long Range, having phased out the Performance model with the design update.

The Tesla Model 3 Long Range version experienced its second price increase in less than two weeks, this time by $500. However, despite the increase, Tesla Model 3 prices are down more than 26% year-over-year. It’s worth noting that this model previously retailed for $55,990. Following the adjustment, the new Model 3 Long Range price now starts at $47,490 – a $1,500 increase from its launch price last month in the US.

Model 3 Long Range Price

The base Model 3 RWD maintains its price at $38,990. These figures are before potential incentives. Notably, the Model 3 Long Range’s price is now on par with the Model Y Long Range, which sits at $47,990.

Traditionally, the Model Y has a higher price than the Model 3. Even now, the base Model Y RWD starts at $42,990 – $4,000 more than the Model 3 RWD.

Tesla is presently extending additional discounts on inventory Model Y vehicles in the US, often rendering the Model Y cheaper than its smaller counterpart, the Model 3.

This mirrors a trend observed with the Model S and Model X in past years.

Tesla adjusts prices based on demand versus production capacity. At present, it can churn out a substantial volume of Model Y, while production of the Model 3 is somewhat constrained.

This price hike comes amidst a backdrop of increased demand and supply chain challenges faced by the auto industry. Delivery windows for the Model 3 have been pushed back, further highlighting the surge in demand.

Currently, enticing deals are available on the Model Y Long Range, making it up to $5,000 more affordable than a brand-new Model 3 Long Range.

Tesla’s decision to raise the price of Model 3 to match that of Model Y might be a strategic one, aimed at differentiating the two models based on their features and capabilities rather than their price. It remains to be seen how this pricing strategy will affect Tesla’s sales and market position in the long term.

Image Source: Sunday Times Driving