Tesla Inc. announced on Wednesday that it has raised lease prices for all its vehicles in the United States following the expiration of a federal electric vehicle (EV) tax credit that had been a key driver of demand. The lease price adjustment follows the removal of the $7,500 Federal incentive on new EV leases and purchases, as well as the $4,000 credit for used EVs, effective September 30. The Biden administration introduced incentives to boost the adoption of battery-powered and hybrid EV vehicles. Trump’s administration policy changes were scrapped, leaving automakers to reassess their lease prices. Tesla increases Model Y’s lease prices Tesla, along with its competitors in the U.S., has been passing credits on to consumers through reduced car prices and lease offers. However, the companies are adjusting their lease prices upward in response to the removal of the credits, although sticker prices remain unchanged. The Model Y’s monthly lease has risen to $529–$599, up from the previous range of $479–$529. The Model 3 lease price has also increased from $429–$759, up from the previous range of $349–$699. The changes underscore the higher cost of entry for consumers without the cushion of federal support. According to Cox Automotive data , Tesla’s U.S. market share fell to 38% in August, marking the lowest record in almost eight years. The previous peak recorded was an 80% share. Rivals, including BYD of China, General Motors, and Hyundai, have expanded their automotive models, offering customers more options. Tesla’s European performance has been mixed. Sales rose for the first time this year in France and Denmark, where Model Y became the best-selling car. Norway’s automotive industry also experienced a rise in sales, with the Model Y and Model 3 ranking among the best-selling electric vehicles. However, Tesla has struggled in the Swedish market, registering a 64% year-over-year decline in September, with only 1,726 cars sold. August recorded the lowest sales, with only 210 vehicles registered. Total sales from January to August fell to 32.6% compared to 42.9% in the same period of the previous year in the EU region. Tesla’s stock fell by 0.36% in the premarket session today Chinese competitor BYD surpassed Tesla in sales in the EU region for the first time this year in April. According to a Cryptopolitan post , BYD registered 7,231 in fully electric cars, surpassing Tesla’s 7,165. China’s EV sales rose 59% yearly against the 26% growth in the U.S., Japan, South Korea, and Europe. Elon Musk’s EV company has not introduced a mass-market model since the launch of Model Y in 2020. The firm has argued that its updated Model Y, which was delivered in several European markets starting from June, will aid in the recovery despite intense competition from Chinese rivals. Elon Musk has also faced backlash due to his political stance in support of right-wing initiatives. Lease affordability was a critical entry strategy that helped the adoption of EV models in the U.S., but now some analysts say the removal of the subsidies places renewed pressure on Tesla’s business model. Tesla has maintained its retail prices, but increased financing and leasing are expected to test market demand across the U.S. Tesla’s stock price is up 0.34 % today, trading at $444.72 at the time of publication. The stock fell by 0.36% during the pre-market session following the announcement, but has so far regained, with a positive YTD of 10.12%. The stock has maintained positive growth over the past six months, with an increase of over 65%, and a yearly price range of $212.11 to $488.54, reflecting sustained investor confidence despite facing challenges in the EV sector. Claim your free seat in an exclusive crypto trading community - limited to 1,000 members.
