ShareThis Page
Business Headlines

Tesla chief unveils a $35,000 Model 3 (that actually costs a bit more)

| Thursday, Oct. 18, 2018, 9:42 p.m.
In this March 31, 2016, file photo, Tesla Motors unveils the new lower-priced Model 3 sedan at the Tesla Motors design studio in Hawthorne, Calif.
In this March 31, 2016, file photo, Tesla Motors unveils the new lower-priced Model 3 sedan at the Tesla Motors design studio in Hawthorne, Calif.

Tesla chief Elon Musk said late Thursday that the automaker was preparing to sell the cheapest version yet of its newest electric car, the Model 3, signaling an attempt to get back to business after months of controversy.

Musk said on Twitter that the sedan, with its “midrange” battery pack, would cost $35,000, bringing it in line with the mass-market model he had promised for years would revolutionize the availability of electric cars.

But that price takes into account federal and state tax rebates. Before the discounts, it will sell for $45,000 - though the company says buyers should think of the car as far cheaper, because of the money they’ll save on gas.

Musk sparked a frenzy of customer reservations in 2016 when he said the Model 3 would cost $35,000 before incentives, such as a $7,500 federal tax credit - a price point that would help Tesla expand beyond its traditional range of well-heeled buyers. That model, however, remains delayed until 2019, the company said Thursday.

The surprise announcement, delivered via tweet to Musk’s 23 million followers, comes as Tesla seeks to steer attention away from a chaotic period in which Musk battled with critics, smoked marijuana during an interview and pledged that he had the money to take Tesla private - a promise for which he was sued by the Securities and Exchange Commission, and which he recently settled.

Musk agreed as part of the settlement to step down as the company’s chairman for three years, opening a prominent void for which the company has yet to fill. But the announcement again highlights Musk’s enduring role as the company’s chief executive, designer and hype man.

Musk said Thursday that the car would be sold via Tesla’s “super simple new order page,” which estimated that delivery for its midrange model would take six to 10 weeks. That model, the company said, could go 260 miles on a single charge.

The only available Model 3 for the last year has been a long-range version, offered mostly at luxury prices. But Musk said a “truer cost of ownership” for the midrange version would be about $31,000, his estimate for discounting the cost of gas.

The move could ratchet up the pressure on Tesla’s already-straining California factory and its nationwide system built to deliver cars to customers, which Musk described last month as mired in “delivery logistics hell.”

“As Model 3 production and sales continue to grow rapidly, we’ve achieved a steady volume in manufacturing capacity, allowing us to diversify our product offering to even more customers,” a Tesla spokesperson said in a statement.

The move could frustrate Tesla fans who put down a $1,000 deposit two years ago for what they believed would be a sleek electric sedan costing about $27,500 after tax incentives.

Tesla says the “standard battery” version will not be available for another 4 to 6 months. Musk has said the company, a cash-burning giant that faces billions of dollars in impending debts, must push out more profitable and expensive versions first: Shipping the cheapest “Model 3 right away (would) cause Tesla to lose money & die,” he tweeted in May.

TribLIVE commenting policy

You are solely responsible for your comments and by using you agree to our Terms of Service.

We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.

While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.

We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers

We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.

We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.

We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.

We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.

click me