Everyone is looking to save a buck these days.
In the past, many EV buyers have been well-heeled, often boasting a garage of several luxury vehicles, so it’s a little surprising to learn just how much Tesla’s price cuts have seemingly fueled sales. According to the company’s first quarter figures, sales saw a nice 36% bump. If you remember, prices on certain configurations of the Model 3 and Model Y were slashed, so that’s being attributed to the sales increase.
Find out what’s really going on with used car prices lately here.
For Q1 2023, Tesla says it delivered 422,875 vehicles globally. That 36% means it only delivered just over 310,000 in Q1 2022. The lions share of that figure was driven by Model 3 and Model Y sales at 412,180 deliveries for those two in the quarter. It seems growth has been spurred by the price cuts, but unless someone does a deep quantitative analysis there’s a possibility other factors might have contributed.
Obviously, many people buying the smaller and cheaper Teslas are also going to be more price sensitive. And with inflation squeezing everyone, saving a buck on purchases, especially major ones like a vehicle, is enough to motivate just about anyone these days.
While price cuts for the Model S and Model X were rolled out in early March, those didn’t generate nearly as much buzz as the slashing of Model 3 and Model Y in January. That move at the beginning of the year was made in part for buyers to qualify for the $7,500 federal tax credit, something which seemed to motivate many who were sitting on the fence to take the plunge and get that electric car they’ve been considering.
This increase in sales is especially interesting since interest rates have increased, putting the pinch on shoppers. However, it’s probably not a stretch to guess a good chunk of Tesla buyers didn’t finance their purchases, something which is more common with premium brands versus mass market options like Kia. Still, this shows just how price sensitive EV shoppers are at the same time Ford has announced it’s increasing the price of certain F-150 Lightning trims yet again.
Images via Tesla