Tesla is slashing prices on its Model Y SUV lineup in an effort to address broader sales challenges and clear out inventory.

Price Reductions

Elon Musk’s Tesla is offering discounts of up to $7,500 on the Model Y SUVs, with varying markdowns across different versions and individual vehicles within each version.

• Some Model Y Performance All-Wheel Drive vehicles now have a price tag of $49,040, down from $54,490.
• Model Y Long Range All-Wheel Drive cars are discounted to $44,990 from $49,990.
• Model Y Rear-Wheel Drive SUVs show a reduced price of $39,470, down from $46,990.

Sales Challenges

Tesla’s latest quarterly report reveals concerning figures. While the company produced 433,371 vehicles in Q1, it delivered only 386,810 units. These delivery numbers fell significantly short of Wall Street’s expectations, marking a 20% drop from the previous quarter and an 8% decline from the same period last year.

Factors Affecting Deliveries

Tesla cited several factors contributing to the drop in delivery volume. These include the production ramp-up for the updated Model 3, an arson attack at its Berlin Gigafactory, and supply chain disruptions stemming from the Red Sea conflict. Softening demand, a common challenge among EV manufacturers, may also be impacting Tesla’s sales.

Stock Performance

Following the quarterly report, Tesla’s shares experienced a more than 5% decline, contributing to an overall drop of approximately 30% over the past year.