Tesla unveils lower-cost versions of Model Y, Model 3 vehicles

Elon Musk’s Tesla on Tuesday unveiled lower-priced versions of its Model Y SUV and Model 3 sedan.

The electric-vehicle maker priced the “Standard” – or base version – of the Model Y and Model 3 at $39,990 and $36,990, respectively.

The Standard version of both vehicles features an estimated range of 321 miles, with a top speed of 125 mph.

TESLA TEASES TUESDAY ANNOUNCEMENT WITH SOCIAL MEDIA VIDEOS

The top-of-the-line version of the Model Y, called “Performance,” has an estimated range of 306 miles, a top speed of 155 mph, a zero-to-60 time of 3.3 seconds and costs $57,490. 

The Performance version of the Model 3 features an estimated range of 309 miles, a top speed of 163 mph, reaches zero-to-60 mph in just 2.9 seconds and is priced at $54,990.

Tesla posted a pair of social media videos over the weekend that tease an unspecified announcement for Tuesday. 

Tesla’s main account on X, the Musk-owned social media platform, posted a video early Sunday morning of a wheel or fan showing Tesla’s logo starting to spin before accelerating.

The video then goes to black with the date 10/7 displayed, suggesting an announcement of some sort on Oct. 7.

ELON MUSK BUYS $1B WORTH OF TESLA SHARES

Tesla posted a second video later on Sunday that showed a car’s headlights on with the body of the vehicle cloaked in darkness.

Chief Executive Elon Musk has for years promised mass-market vehicles, though last year he canceled plans to build an all-new $25,000 EV, Reuters first reported. Instead, he chose to build affordable versions based on Tesla’s current models, sparking concerns among investors and analysts that the cheaper cars would cannibalize sales of existing vehicles and limit growth.

TESLA OFFERS MASSIVE $1 TRILLION PAY PACKAGE TO ELON MUSK

Late last year, Musk said the vehicle would be priced below the “key threshold” of $30,000, including U.S. EV tax credits.

The lower-priced versions of the popular models follow Tesla’s record third-quarter deliveries, which were driven by a surge in EV purchases ahead of the expiration of the federal government’s $7,500 EV tax credit on Sept. 30. 

“The desire to buy the car is very high. (It’s) just (that) people don’t have enough money in the bank account to buy it,” Musk said in July during Tesla’s second-quarter earnings call. “So the more affordable we can make the car, the better.”

Despite the boost from a strong third quarter, analysts expect Tesla’s annual deliveries to decline for a second consecutive year to about 1.62 million vehicles, amid lower demand due to the expiration of EV purchase tax credits as well as political headwinds from Musk’s work with the Trump administration.

However, Wall Street expects Tesla’s deliveries to rebound to 1.85 million vehicles next year, with the cheaper model accounting for 155,610 units in 2026, per estimates from Visible Alpha.

Reuters contributed to this report.