Tesla drops price of Model 3 in bid to spur EV market
Tesla has announced plans to reduce the purchase price of its Model 3 car to £26,500 as it aims to grow its share of the electric vehicle (EV) market.
The firm will achieve a reduction in price, which is currently more than £37,700, by shutting showrooms and making purchasing online only.
It believes customers will not be put off from purchasing vehicles without a test drive as any Model 3 can be returned after a week, free of charge.
The Model 3, which is the firm’s standard model, has a range of 220 miles, a top speed of 130mph, 0-60mph acceleration in 5.6 seconds, and a 5-star safety rating. The vehicle forms the third stage of Tesla’s strategy to make EVs a mainstream proposition for the average car buyer.
A four-step plan will see Tesla build on the success of its EV portfolio by extending the electrification process to heavy-duty trucks and high passenger-density urban transport.
At the same time as the price drop announcement, Tesla also introduced a new variant of the Model 3, which offered 240 miles of range, a top speed of 140 mph, 0-60 mph acceleration of 5.3 seconds at £27,900. Tesla has offered the Model 3 to customers with battery pack capacities of 50kWh or 75kWh.
The firm said the ability to buy a Tesla on your phone within one minute – currently available in the US – would soon be extended to global distribution. A full refund on a vehicle will be offered up to seven days after purchase, or less than 1,000 miles of use.
Tesla hopes that shifting sales online, alongside other cost efficiencies, will enable the firm to lower all vehicle prices by approximately 6%.
A blog post from the company said: “Over the next few months, we will be winding down many of our stores, with a small number of stores in high-traffic locations remaining as galleries, showcases and Tesla information centres.
“At the same time, we will be increasing our investment in the Tesla service system, with the goal of same-day, if not same-hour service, and with most service done by us coming to you, rather than you coming to us. Moreover, we guarantee service availability anywhere in any country in which we operate.”
The firm also announced it was implementing a number of firmware upgrades to vehicles which will see its long-range Model 3 extended to 325 miles in range, increase the top speed of its Model 3 performance model to 162mph, and add 5% peak power to all Model 3 vehicles.
The news follows Tesla reducing the price of its new EVs by $2,000 (£1,590) for US customers in January, in a bid to offset a recent Governmental cut to EV tax credits.