It’s a new year, and that means Tesla has plenty of opportunities to pick itself back up after suffering some devastating blows in 2022. The company’s stock reached historic lows, and investors expressed their outrage. Even Tesla drivers dealt with the blowback of the public outrage facing the brand’s CEO, Elon Musk. Tesla has fallen from grace in many ways, but its stock price is still more than double that of older and more trusted automotive brands. How can Tesla win back the hearts of consumers?
A more affordable Tesla Model Y could turn the tide for Tesla
Tesla Inc. is easily one of the most impactful automotive brands of the last decade. The electric vehicle and clean energy company was once the largest producer of electric vehicles in America. Though it may not dominate the EV market share in the states anymore, it’s still a force to be reckoned with globally.
Tesla makes electric vehicles that consumers have come to know and love over the years despite reports of unreliability. Tesla EVs have their own distinct design language that separates the company from other automakers. It also seems to be pushing the envelope, for better or worse.
Recent events have caused some consumers to cancel their orders altogether and give up on purchasing a vehicle from the company. Current Tesla drivers have experienced road rage following the controversy surrounding Elon Musk’s acquisition of Twitter. No matter how you look at it, Tesla is beginning to become wildly unpopular. The arrival of new EV alternatives from older brands coupled with Tesla price bumps, delivery issues, and reports of unreliability create the perfect storm, leaving the door open for other automakers to claim more market share.
If Tesla wants to get back in the good graces of consumers, it needs to act quickly. The Tesla Model Y is currently one of the brand’s most popular vehicles. The Model Y is pricey compared to other small electric SUVs. Here’s how Tesla could make the Model Y more affordable and thus sell more models.
How to make the Tesla Model Y more affordable
The 2023 Tesla Model Y starts at $65,990. That’s significantly more expensive than the average new vehicle. Kelley Blue Book claims that the average new vehicle price was $48,681 back in November. The most popular SUV on the market, the Toyota RAV4, now starts at $27,975 (well below the average new vehicle price).
So, it’s clear that it would be advantageous to sell the Model Y for a more affordable price, but how could Tesla accomplish that without obliterating the profit margins that keep the company afloat? The simple solution is to offer a Model Y with a smaller battery and less total driving range.
According to Electrek, Tesla is preparing to launch a slightly more affordable Model Y with a 4680-cell battery. This battery gives the Tesla Model Y a 279-mile driving range, as opposed to the Model Y Long Range’s 330 miles of range. That 51-mile range reduction brings the Model Y’s price down to $61,990 based on Electrek’s findings. Gee, thanks Tesla.
The Tesla Model Y that America needs
If Tesla wants the Model Y to become ubiquitous in the next few years (which is the goal for most EV producers), affordability is a huge issue. Affordability is one of the reasons that the Hyundai Ioniq 5 and Volkswagen ID.4 are becoming so popular. If the company wishes to remain an exclusive luxury brand, it needs to address the unreliability that is associated with its vehicles. The Tesla Model Y that America needs either has to be significantly more affordable (which would mean less driving range) or much more reliable.