Tesla enthusiasts and potential customers in North America have been eagerly anticipating the release of the updated Model 3. This revamped electric vehicle, which has already made its way to Europe, Asia, and Oceania since September of last year, brings a host of technological advancements and enhanced comfort features compared to its predecessor. Right from the start, it was evident that there was a strong demand for the new model, overwhelming the production capacity at Tesla’s Fremont factory.
However, as is often the case with new vehicle releases, the initial production rate is not particularly high. Tesla requires time to fine-tune the production line for the new components and manufacturing processes. Nevertheless, many anticipated a smoother process for the Model 3 Highland edition. Tesla’s gigafactory in China faced no issues in ramping up production, especially considering that the refreshed model is not significantly different from its predecessor. However, the situation at Fremont is not comparable to Giga Shanghai, and Tesla’s desired pace is not being achieved.
Consequently, the delivery timeline for the Model 3 RWD has been pushed from January-February to February-March, while the Model 3 Long Range AWD is now expected to be delivered between April and May. This suggests that the latter variant is in higher demand, while the base version of the Model 3 RWD is less appealing. This assumption is further supported by Tesla’s recent decision to raise the price of the AWD model by $500. It should be noted that the Long Range variant was already quite expensive to begin with. This marks the second time Tesla has increased the price of the Model 3 LR, following a $1,000 hike on February 4.
Unfortunately, the higher price seems to be deterring potential buyers. At $47,490, the Model 3 LR is only $500 more expensive than the Model Y LR. However, the Model Y is eligible for a $7,500 tax credit, bringing its price down to $40,490. Additionally, if customers choose a Model Y LR from Tesla’s inventory, they can acquire it for $36,650 with the tax credit. This is nearly $11,000 less than the Model 3 LR. In fact, for $44,990, including the tax credit, customers can even purchase a Model Y Performance variant.
One of the main reasons why Tesla appears to be hesitant in selling the Model 3 is due to the challenges faced in ramping up production at the Fremont factory. The situation is considerably better at Giga Shanghai. However, Chinese customers have also expressed concerns about the Model 3’s price in comparison to the Model Y. Interestingly, the Model 3 RWD does not seem to be affected by the price increase or delayed delivery, indicating that customers are not particularly eager to acquire the 260-mile range Model 3.
This situation arises from supply difficulties resulting from the temporary pause in Model 3 production and the slowdown at the Fremont factory during the Highland upgrade.
For more information, please refer to my previous article on this topic: [link to article].
According to the Source autoevolution.com