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Tesla cuts U.S. prices for the fifth time since January

Tesla lowered its pricing in the United States by 2% to almost 6% on Thursday, according to its website, as the firm continued a discount campaign on its electric cars that experts warn will affect profitability.

The sixth such drop in Tesla’s biggest market since the beginning of the year comes as the US prepares to implement harsher requirements this month, which are anticipated to restrict EV tax incentives.

Tesla reduced costs on both variants of its Model 3 car by $1,000 and on its Model Y crossover by $2,000, according to its website. Tesla also reduced pricing by $5,000 on both variants of its more costly Model S and Model X.

Since January, the firm has said that the higher US regulations would lower the $7,500 tax credit available for its basic, rear-wheel-drive Model 3.

Several experts who predicted additional price drops expressed worry that Tesla’s industry-leading profit margins would be jeopardised.

Last week, Tesla announced first-quarter deliveries of over 423,000 cars, a 4% increase over the previous quarter due to price reductions in the United States, China, and other areas aimed at increasing demand.

This year, Tesla has set a goal of 1.8 million deliveries.

Tesla has reduced the price of its basic Model 3 by 11% since the beginning of the year, with a 20% drop on the base Model Y.

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