Tesla’s electric automobiles were never particularly affordable, and their prices have only increased in recent years. In order to earn money, Elon Musk’s electric vehicle firm has hiked the cost of its whole portfolio of vehicles by up to 10 percent; some price hikes amount to thousands of dollars, so the difference is rather significant. Although neither Musk nor the company staff has commented on the sudden price jump, it is as obvious as day on Tesla’s website, which makes it easy to see. What caused Tesla to raise its costs, and how much more money will you have to pay today in order to own the renowned electric vehicle?
When it comes to cost, Tesla automobiles already have a wide range; the least expensive vehicle in the portfolio is the Model 3 Rear-Wheel Drive, which was previously priced at around $45,000. When you go for one of the top-shelf vehicles, like the Model S Dual Motor, which was previously $95,000, or the most costly vehicle in the inventory, the Model S Tri-Motor, which was previously $126,000, the costs skyrocket. Strangely enough, the Model S Tri-Motor has now been dethroned as Tesla’s most expensive vehicle, sliding to second place as a result of the price reduction.
Following the price increases, the Model X Tri-Motor will be the most expensive Tesla, with a $12,500 premium over the previous Model X Tri-Motor. The automobile, which was originally listed for $126,490, is now available for $138,990. The Model S Tri-Motor, on the other hand, was formerly priced at $129,990 but is now priced at $135,990, representing a $6,000 price increase.
As previously stated, these modifications have an impact on the whole portfolio, with each car costing at least a few thousand dollars extras. No one buys Teslas because they are inexpensive, so this is unlikely to deter a large number of prospective consumers, but it is tough to ignore the fact that these price increases are obvious. Let us have a look at the costs today compared to a week ago, as obtained from Tesla’s official website:
The price hike is affecting markets in China and the United States, but it is probable that prices would rise around the globe as a result of the price increase. The fact that this is the second rise for Tesla in a couple of days is maybe the most shocking aspect of all. It was announced on March 9 that the long-range variants of Tesla’s Model 3 and Model Y will be more costly in the United States.
Fortunately, this was not a significant raise – merely $1,000 for each of the employees. Alternatively, costs for the Model Y Long Range have been steadily increasing throughout the course of 2021, reaching a total of $10,000 in the process. Prices are rising for other Tesla cars that are also impacted, with technology like forward-sensing radar (FSD) proving to be far more costly than anticipated.
The following tweet from Elon Musk on March 14 provides some insight into why the costs of Tesla’s electric vehicles are increasing. According to Musk, “Tesla and SpaceX are under severe recent inflation pressure in raw materials and logistics.” “And we are not alone in this,” he said, referring to a Financial Times piece that details the steady rise in commodities prices, which he linked to.
Of course, all of this is connected to Russia’s continuous assault of Ukrainian territory. Due to Russia’s fast exclusion from a wide range of international trade and service agreements, as well as from government accords, exporting products from the country is becoming more difficult. Many businesses prefer not to do so, even though they are still legally obligated to do so. As a consequence, the cost of raw materials, which are required to manufacture a wide range of goods, including Tesla automobiles, is increasing.
Although Elon Musk has not said it explicitly, it is highly probable that Tesla’s price increase is linked to the fact that obtaining the necessary raw materials is more difficult than it has ever been. Inflation in the United States is likewise on the upswing, having risen by 7.9 percent so far this year. As a consequence, it is possible that price increases may be implemented across the board.