Why Tesla Brought Back the Cheaper Model S

Tesla Model S
You’ll get less range, but the cheaper Model S has a more reasonable price. | Source: Tesla

With all the talk about the Tesla Model 3 and Model X these days, it might be easy to forget about the company’s flagship electric vehicle, that elegant Model S that once broke the Consumer Reports rating system. Yes, this car is still wowing those who own it and wooing those who don’t. In fact, Tesla is trying to attract more customers who don’t have $100,000 stashed underneath the mattress with the re-release of a cheaper Model S. The automaker finally has the production capacity to handle potential demand.

Are you getting confused about the different Tesla Model S trims available? We don’t blame you. This car has changed more than Donald Trump’s mind in the past 12 months. However, the latest update simplifies things a bit because now there is a less expensive model ($66,000) that actually drops below the base price to $58,500 after incentives get counted. (Colorado residents could make it a more appealing $52,500 after state incentives.)

Tesla Model S
Model S has crept below $60K after incentives for U.S. buyers. | Source: Tesla

This lowest-priced edition offers drivers 210 miles of range via 60 kWh battery specifications. Yet there is more juice hiding under the hood. Tesla has a 75 kWh battery inside every model below the 90 kWh editions — they’re just stuck behind a paywall. Open it up for $8,500 and you will receive an extra 39 miles of range, giving you a total of 249 miles. Buyers who want to wait can do it after delivery for an extra $500 ($9,000). It’ll be there when you’re ready, waiting for a software update.

The timing of Model S 60’s reappearance may sound strange to those who recently watched it go away in favor of the 70 kWh model, but Tesla has more capacity to work with in its Fremont plant and more interest than ever in its products, thanks to the Model 3 debut. Model S 70 is now two different cars (60 and 75) that appeal to different consumers. Overall, that should mean more sales as the company tries to maintain production goals and keep consumers’ attention.

A view of a fully electric Tesla car on an assembly line at the new Tesla Motors car factory in Tilburg, the Netherlands, during the opening and launch of the new factory, on August 22, 2013. The American electric car manufacturer Tesla Motors, led by American-South African inventor and entrepreneur Elon Musk, will be assembling fully electric cars for the European market in this new factory.
A view of a Tesla Model S on an assembly line at the new factory in Tilburg, the Netherlands. | Guus Schoonewille/AFP/Getty Images

Sales in the first quarter were disappointing for the electric car maker as the company prepped for the Model S facelift and continued working in the Model X, which has had a troubled release (to put it mildly). After breaking the 50,000 sales mark for the first time in 2015, Tesla wants to push for more than 80,000 this year. So far, the company has lagged when compared to the final three months of last year. But there is time to rebound, and the first quarter is typically the slowest for plug-in sales.

Nonetheless, Tesla is banking on a minimum 60% increase in deliveries in a single calendar year. You may have heard the company is planning to push the number to 500,000 just two years later, too. Each of these goals is ambitious and bordering on unrealistic in the way we have come to understand the principles of scale and production in general.

In May, the race for top-selling plug-in car in America got far more interesting than Tesla would like. Chevy Volt, the car with 53 miles of electric range before switching to gas, came within about 500 units of Model S sales through the first five months of 2016. While the U.S. market is only one of many for Tesla, it has to top the pack in order to achieve its sales goals. Maybe the cheaper Model S has been the missing ingredient. It will certainly be the most affordable thing the automaker has until late 2017.

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