DETROIT (AP) — Tesla cut prices on its entire U.S. electric vehicle model lineup for the third time this year in an apparent effort to lure more buyers amid rising interest rates.
The cuts that appeared Friday on Tesla’s website ranged from $5,000 per vehicle for Tesla’s slower-selling more expensive models, the S large sedan and the X big SUV.
The company lopped $2,000 off the price of the Y small SUV, its most popular model, and added a lower-cost dual-motor version priced at $49,990. The 3 small sedan saw a $1,000 price cut.
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The moves come as Tesla’s first-quarter sales grew 36% but fell short of analysts’ expectations. The company said Sunday that it delivered a quarterly record of 422,875 vehicles worldwide from January to March, up from just over 310,000 a year ago. But the increase fell short of analyst estimates of 432,000 for the quarter, according to FactSet.
A message was left Friday seeking comment from the Austin, Texas-based Tesla on why the prices were cut.
Guidehouse Research e-Mobility Analyst Sam Abuelsamid said the company needs to sell more vehicles to keep its factories running at full capacity. “Overhead of underutilized plant eats up (profit) margin extremely quickly,” he said.
Tesla has added a huge plant near Austin to its U.S. factory footprint, in addition to its original plant in Fremont, California. The company also has built new plants in Shanghai and near Berlin.