Tesla to raise EV prices as it cuts back on retail store closures

Tesla looks set to reduce the number of brick and mortar retail stores that will close over the following months, in a move that will see the prices of its electric vehicles (EVs) increase by 3%.

Tesla had announced plans to reduce the purchase price of its Model 3 car to £26,500

Tesla had announced plans to reduce the purchase price of its Model 3 car to £26,500

Earlier this month, Tesla announced plans to close a large number of its retail stores, hoping that shifting sales online, alongside other cost efficiencies, will enable the firm to lower all vehicle prices by approximately 6%.

However, the US-firm has since announced plans to reverse the decision that would close the majority of its 378 stores globally. The original closure decision caused controversy due to potential job losses. The move to an online-only shopping service also meant that customers would be unable to view potential purchases.

“As a result of keeping significantly more stores open, Tesla will need to raise vehicle prices by about 3% on average worldwide," a blog post explained. "In other words, we will only close about half as many stores, but the cost savings are therefore only about half."

Tesla had announced plans to reduce the purchase price of its Model 3 car to £26,500, which is currently more than £37,700, by shutting showrooms and making purchasing online only.

Price drops

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.

Tesla has 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 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.

Matt Mace


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electric vehicles | Retail | transport | technology

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Technology & innovation
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