Tesla announced on Friday that it has increased prices on certain Model Y vehicles in the United States by $1,000, as indicated on its website.
The price adjustments affect the Model Y rear-wheel drive and long-range variants, which now stand at $43,990 and $48,990, respectively.
However, prices for the Model Y Performance variant and other models remain unchanged, according to the company’s website.
In February, Tesla had implemented temporary price reductions on select Model Y cars in the U.S., a move that was set to last until Feb. 29.
This decision came nearly a month after the company had slashed prices across its offerings in Europe and China. CEO Elon Musk addressed the fluctuating pricing strategy, acknowledging the challenge posed by balancing continuous production to maintain efficiency with the seasonal fluctuations in consumer demand.
Recent consumer preferences in the United States have leaned towards hybrid vehicles rather than purely electric ones in efforts to mitigate higher ownership costs.
Additionally, some buyers have opted for hybrid models due to concerns about certain electric vehicles losing federal tax credits over battery sourcing requirements under the Inflation Reduction Act.
These factors have influenced market dynamics and purchasing decisions within the automotive sector.
Despite facing challenges such as pricing pressures and production focus shifts, Tesla remains committed to advancing its electric vehicle lineup.
The company had previously signaled expectations of “notably lower” sales growth for the year as it directs attention towards the development and production of its next-generation electric vehicle, internally referred to as “Redwood.”
The latest price adjustments are anticipated to alleviate some margin pressures for Tesla, which has been navigating a price war with competitors for over a year. As of now, Tesla shares have declined by 18.75% since the beginning of the year.