Tesla has announced a fifth round of price cuts in the United States for its electric vehicles, as the company continues its efforts to boost demand for its models. The latest cuts range from 2% to almost 6% and include $1,000 off both versions of the Model 3 sedan and $2,000 off the Model Y crossover, as well as $5,000 off both versions of the more expensive Model S and Model X.
This marks the fifth time that Tesla has reduced prices in its largest market since the start of 2021. The move comes ahead of tougher standards expected to be adopted by the US this month, which are anticipated to limit electric vehicle tax credits. In response, Tesla has been offering discounts in a bid to maintain sales.
However, some analysts have warned that these repeated price cuts could put Tesla's profitability at risk. The company has already seen a significant reduction in its tax credit, with the tougher US standards expected to reduce the available tax credit by $7,500 since January. Despite these concerns, Tesla reported first-quarter deliveries of almost 423,000 vehicles this week, representing just a 4% increase from the prior quarter after the price cuts in the US, China, and other markets. The company has set a target of delivering 1.8 million vehicles in 2021.
