In the latest move reflecting Tesla (NASDAQ:TSLA)’s ongoing pricing strategy, the automaker announced another round of price cuts for its U.S. lineup on Thursday. The reductions affect several models, including the Model 3 and Model Y variants, according to information reported on Tesla’s website.
The Model 3 rear-wheel drive now costs $38,990, down from $40,240. Prices for the Model 3 long-range and performance variants were also reduced, now listed at $45,990 and $50,990, respectively. The Model Y long-range vehicle experienced a price reduction from $50,490 to $48,490 while its performance variant is now priced at $52,490.
This isn’t the first time Tesla has adjusted its prices this year. Earlier in 2023, the company twice reduced the prices of its Model S and Model X base models by $5,000 each – first in April and later on September 1st. These moves indicate a persistent strategy by Tesla to adjust pricing in response to market conditions or strategic objectives.
Tesla’s pricing strategy can be seen in the context of its strong financial performance. Tesla’s market cap stands at a robust $825.18 billion. Its revenue for the last twelve months (LTM2023.Q2) was $94.03 billion, showing a growth of 39.99 %. The company also achieved a gross profit of $20.2 billion in the same period, with a gross profit margin of 21.49 %.
Tesla yields a high return on invested capital and has more cash than debt on its balance sheet. It’s also worth noting that Tesla is consistently increasing its earnings per share, and analysts anticipate further sales growth in the current year.
