Tesla offers doubles discounts on 2 top-selling models!– OnMyWay Mobile App User News

Tesla is offering a rare discount on two top-selling electric car models until the end of the year as demand for the vehicles slows.

The Texas company began offering a $3,750 incentive on its Model 3 sedan and Model Y SUV earlier this month, but on Wednesday it doubled the discount to $7,500 for those who take delivery between now and December 31.

Tesla shares have lost more than 60 percent of their value since CEO Elon Musk announced in April that he had taken a large stake in Twitter, causing investors to question where his focus would lie. Further deepening investor stress, Musk himself has sold off nearly $23billion worth of Tesla stock since April, with much of the money likely going to help fund his $44 billion acquisition of Twitter.

‘This is a sign of demand cracks and not a good sign for Tesla heading into the December year-end,’ Wedbush analyst Dan Ives said. ‘EV competition is increasing across the board, and Tesla is seeing some demand headwinds.’

The move comes ahead of a new federal tax credit of up to $7,500 that’s scheduled to take effect January 1.

Tesla were not eligible for a previous federal tax credit program because the company had reached a cap of 200,000 vehicles sold. Next year’s credits do not have such a limit.

Lower priced versions of the Models 3 and Y will be eligible for the federal tax credit come January due to limits on vehicle purchase prices outlined in the Inflation Reduction Act.

Without the discounts, the Model 3 starts at just over $48,000 including shipping, while the Y has a starting price of just over $67,000. To be eligible for the federal tax credit, vehicles cannot have a sticker price of over $55,000 for sedans and $80,000 for trucks and SUVs.

In a regulatory quirk, many vehicles like Teslas that are made in North America likely will be eligible for the full $7,500 tax credit from January into March because the Treasury Department is still working on rules requiring battery minerals and parts to come from North America. It’s likely that most of the vehicles will only be eligible for half the credit once the rules come out in March.

Tesla may be offering the discounts to juice demand before the end of the year in an effort to meet a pledge to grow vehicle sales by 50 percent.

On the company’s third-quarter earnings conference call in October, Tesla CFO Zachary Kirkhorn said Tesla will fall just short of its 50 percent sales growth target. But he later was contradicted by Musk.

The billionaire predicted 50 percent annual production and delivery growth, but also pointed to logistical problems shipping vehicles.

To reach the 50 percent sales growth target, Tesla must have a stellar performance in the fourth quarter.

Through September the company delivered 908,573 vehicles, compared with just over 936,000 vehicles a year ago. To increase sales by 50 percent over last year, which would amount to about 1.4 million vehicles, and the company would have to sell more than 490,000 vehicles in the fourth quarter.

Industry analysts polled by data provider FactSet expect Tesla to deliver 431,000 vehicles in the fourth quarter, ending the year at 1.341 million.

Tesla shares fell nearly 10 percent in Thursday afternoon trading to a new two-year low of $124.07 after US safety regulators said they would probe two more Tesla crashes possibly involving automated driving systems.

After Musk bought Twitter, many investors became worried about demand and that the CEO had been distracted from the car company.

Musk said this week that he plans to remain as Twitter’s CEO until he can find someone willing to replace him in the job after losing his own poll asking whether he should step down.


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