The auto manufacturer is now offering discounts of $7,500 for Model 3 and Model Y EVs delivered this month.
Following the introduction of a $3,750 discount to Model 3 and Model Y buyers earlier this month, Tesla has now doubled its incentive by offering to slash the price of these electric vehicles by $7,500 if they are delivered in the US before the end of December. The new discount was revealed on the automaker's website on Wednesday, 21 December, and follows the recent offer of 10,000 free supercharging miles.
The two offers are connected and are only valid for this month, which suggests that Tesla is trying to entice more buyers to commit to a purchase before the new year. Thanks to the government's recent delay in providing guidelines on EV tax credits, pushing its announcement to March, more EVs will continue to qualify for the $7,500 credit for January and February, which means more competition for Tesla.
A number of media outlets have speculated that this discount offer is Tesla's response to the increasingly negative press surrounding the takeover of Twitter by Tesla CEO Elon Musk. After acquiring the social platform earlier this year and devoting most of his time to the role of "Chief Twit," Musk has seen Tesla's share price plummet, casting doubt over the future of Tesla and its management.
Musk attributes Tesla's recent valuation concerns to rising interest rates and other macroeconomic factors, while his detractors argue that his divided focus has forced negative press on Tesla. As a result, some theorize that this discount is Tesla's way of trying to detract from the Twitter debacle, but it's worth remembering that Tesla has offered discounts around this time of the year before.
Although we have no doubt that Musk's antics have contributed to the drop in Tesla's share price, Tesla is not the only big company feeling the pinch. Falken Tire recently announced that it is ending its Formula Drift and Champ Offroad motorsports programs, and this is just one of many companies adopting similar strategies. The recession that Musk himself predicted is upon us. As money gets spent less freely, we predict that numerous other automakers will begin offering discounts in the new year to generate more turnover.
With EV prices rising across the board, demand for all brands is likely to drop somewhat in the new year. However, those tax credits we mentioned at the outset will put Tesla at a disadvantage. Its cheapest car barely sneaks in below the $55,000 threshold for credits, and since the company uses Panasonic and CATL-sourced batteries, even the least expensive Model 3 won't qualify for the full $7,500 credit.
Whatever the true motivation behind the discount, it still raises eyebrows to consider that Tesla has quickly doubled an offer that only recently became active. With increasing competition in the EV space, and since the company has very little in the way of new products on the way, it needs to shift the inventory it has as quickly as possible.
Then again, it could be that Tesla is simply trying to inflate its figures before the end of the quarter and the year so that it can provide its shareholders with better-looking results for the period. Regardless, a Model 3 and a Model Y are now notably cheaper to buy and run, and if you've been waiting to do so, now may be the perfect time to get a new Tesla.