Tesla Massively Reduces Prices. Here Are the New Prices and Why They Did It

By Kevin Armstrong
Tesla makes their vehicles more affordable in regions around the world
Tesla makes their vehicles more affordable in regions around the world
Not a Tesla App

Tesla dropped prices on all models in several countries, which should not be surprising. It's unlikely it has anything to do with the company's plummeting value on the stock market, a perceived lower demand, or an effort to qualify for tax credits. Tesla's entire price drop game plan was forecast just a few days ago by a Tesla executive in China.

Tesla does not have a communications department. All the company information comes from its website, social media accounts or Elon Musk's Twitter account. That's why it was worth finding a translation of a rare interview a Tesla vice president gave to the media in China on January 9, 2023.

When Tesla Executives Speak, You Should Listen

Tao Lin spoke to reporters just days after Tesla dropped the prices in China. Her answers provided reasons behind the lower prices, not only in China but worldwide. "Some media said that we lowered the price because we couldn't sell anymore. I think it's really nonsense," Lin said. "I personally think that the price adjustment reflects our better planning for the supply chain in a sense, and what level the vehicle cost will be, and then we make such adjustments according to this estimate."

Lin then explained, "The price adjustment of a product is actually a forecast of the company's cost changes in the next period of time. The biggest difference between 2023 and last year is that the epidemic has basically passed. We believe that the supply chain has returned to normal to a large extent, and there will be no such unpredictable shortages of materials as in previous years, which brought cost uncertainty."

Tesla Supply Chain Certainty Indicated in Q3

During the third quarter earnings call, Musk spoke about supply chain issues that had hampered production during the pandemic. But he also discussed how the company had advanced in other areas and was optimistic about future production. "What we are seeing is practical improvements as we redesign the whole supply chain and all of the elements that go into a battery cell. We're figuring out dramatic efficiencies."

Zachary Kirkhorn, Tesla's Chief Financial Officer, answered a question about the Inflation Reduction Act during that same earnings call. There were not many details available at that time. Still, he stated, "it's difficult to fully determine the eligibility criteria, but we believe Tesla is very well-positioned to capture a significant share of that for solar storage and also electric vehicles."

Tesla's Transparency is the Problem

Some customers in China who bought a Tesla just before the price cut were furious. That's likely to be the case in other countries as well. However, consumers need to remember that Tesla is a direct sales model. How quickly everyone forgets auto dealers have been changing prices for decades.

Lin gave this example, "for a traditional car, everyone buys it at a different price at a dealer, so you don't really know whether the price you bought is the lowest or not, and you don't know what price other people are buying. Is it fair to consumers?"

Tesla has not only changed the automotive industry by making electric vehicles a viable product, but it also changed how people buy cars. "We adopted some relatively new concepts, such as the direct sales model, such as price adjustment strategies, and we hope to gradually make everyone feel that these concepts are feasible. Under the direct sales model, the prices are completely open and transparent, without discounts or price increases, and everyone is the same at the same time."

Price Reductions in the U.S.

We suspected these price cuts were coming as the EV tax credit in the US listed all Model 3s and Model Ys as qualifying for the tax credit. All variations of the Model Y now qualify for the $7,500 tax credit in the US.

The price cuts also affect many countries around the world such as Spain, France and Portugal. Although the reduced pricing of the Model S and Model X appears to be limited.

Below is a list of the new and previous prices of all Teslas models in the US and the percentage changed.

Model New Price Prev Price Percent Change
Model 3 RWD $43,990 $46,990 -6.4%
Model 3 Performance $53,990 $62,990 -14.3%
Model Y Long Range $52,990 $65,990 -19.7%
Model Y Performance $56,990 $69,990 -18.6%
Model S $94,990 $104,990 -9.5%
Model S Plaid $114,990 $135,990 -15.4%
Model X $109,990 $120,990 -9.1%
Model X Plaid $119,990 $138,990 -13.7%

Tesla Plans Massive 10x Robotaxi Expansion: A Look at the Potential New Area

By Karan Singh
Not a Tesla App

With Tesla’s first major expansion of the Robotaxi Geofence now complete and operational, they’ve been hard at work with validation in new locations - and some are quite the drive from the current Austin Geofence.

Validation fleet vehicles have been spotted operating in a wider perimeter around the city, from rural roads in the west end to the more complex area closer to the airport. Tesla mentioned during their earnings call that the Robotaxi has already completed 7,000 miles in Austin, and it will expand its area of operation to roughly 10 times what it is now. This lines up with the validation vehicles we’ve been tracking around Austin.

Based on the spread of the new sightings, the potential next geofence could cover a staggering 450 square miles - a tenfold increase from the current service area of roughly 42 square miles. You can check this out in our map below with the sightings we’re tracking.

If Tesla decides to expand into these new areas, it would represent a tenfold increase over their current geofence, matching Tesla’s statement. The new area would cover approximately 10% of the 4,500-square-mile Austin metropolitan area. If Tesla can offer Robotaxi services in that entire area, it would prove they can tackle just about any city in the United States.

From Urban Core to Rural Roads

The locations of the validation vehicles show a clear intent to move beyond the initial urban and suburban core and prepare the Robotaxi service for a much wider range of uses.

In the west, validation fleet vehicles have been spotted as far as Marble Falls - a much more rural environment that features different road types, higher speed limits, and potentially different challenges. 

In the south, Tesla has been expanding towards Kyle, which is part of the growing Austin-San Antonio suburban corridor spanning Highway 35. San Antonio is only 80 miles (roughly a 90-minute drive) away, and could easily become part of the existing Robotaxi area if Tesla obtains regulatory approval there.

In the East, we haven’t spotted any new validation vehicles. This is likely because Tesla’s validation vehicles originate from Giga Texas, which is located East of Austin. We won’t really know if Tesla is expanding in this direction until they start pushing past Giga Texas and toward Houston.

Finally, there have been some validation vehicles spotted just North of the new expanded boundaries, meaning that Tesla isn’t done in that direction either. This direction consists of the largest suburban areas of Austin, which have so far not been serviced by any form of autonomous vehicle.

Rapid Scaling

This new, widespread validation effort confirms what we already know. Tesla is pushing for an intensive period of public data gathering and system testing in a new area, right before conducting geofence expansions. The sheer scale of this new validation zone tells us that Tesla isn’t taking this slowly - the next step is going to be a great leap instead, and they essentially confirmed this during this Q&A session on the recent call. The goal is clearly to bring the entire Austin Metropolitan area into the Robotaxi Network.

While the previous expansion showed off just how Tesla can scale the network, this new phase of validation testing is a demonstration of just how fast they can validate and expand their network. The move to validate across rural, suburban, and urban areas simultaneously shows their confidence in these new Robotaxi FSD builds.

Eventually, all these improvements from Robotaxi will make their way to customer FSD builds sometime in Q3 2025, so there is a lot to look forward to.

Caught on Video: Tesla FSD Tackles a Toll Booth — Here’s How It Pulled It Off

By Karan Singh
@DirtyTesLa on X

For years, the progress of Tesla’s FSD has been measured by smoother turns, better lane centering, and more confident unprotected left turns. But as the system matures, a new, more subtle form of intelligence is emerging - one that shifts its attention to the human nuances of navigating roads. A new video posted to X shows the most recent FSD build, V13.2.9, demonstrating this in a remarkable real-world scenario.

Toll Booth Magic

In the video, a Model Y running FSD pulls up to a toll booth and smoothly comes to a stop, allowing the driver to handle payment. The car waits patiently as the driver interacts with the attendant. Then, at the precise moment the toll booth operator finishes the transaction and says “Have a great day”, the vehicle starts moving, proceeding through the booth - all without any input from the driver.

If you notice, there’s no gate here at this toll booth. This interaction all happened naturally with FSD.

How It Really Works

While the timing was perfect, the FSD wasn’t listening to the conversation for clues (maybe one day, with Grok?) The reality, as explained by Ashok Elluswamy, Tesla’s VP of AI, is even more impressive.

FSD is simply using the cameras on the side of the vehicle to watch the exchange between the driver and attendant. The neural network has been trained on enough data that it can visually recognize the conclusion of a transaction - the exchange of money or a card and the hands pulling away - and understands that this is the trigger to proceed.

The Bigger Picture

This capability is far more significant than just a simple party trick. FSD is gaining the ability to perceive and navigate a world built for humans in the most human-like fashion possible.

If FSD can learn what a completed toll transaction looks like, it’s an example of the countless other complex scenarios it’ll be able to handle in the future. This same visual understanding could be applied to navigating a fast-food drive-thru, interacting with a parking garage attendant, passing through a security checkpoint, or boarding a ferry or vehicle train — all things we thought that would come much later.

These human-focused interactions will eventually become even more useful, as FSD becomes ever more confident in responding to humans on the road, like when a police officer tells a vehicle to go a certain direction, or a construction worker flags you through a site. These are real-world events that happen every day, and it isn’t surprising to see FSD picking up on the subtleties and nuances of human interaction.

This isn’t a pre-programmed feature for a specific toll booth. It is an emergent capability of the end-to-end AI neural nets. By learning from millions of videos across billions of miles, FSD is beginning to build a true contextual understanding of the world. The best part - with a 10x context increase on its way, this understanding will grow rapidly and become far more powerful.

These small, subtle moments of intelligence are the necessary steps to a truly robust autonomous system that can handle the messy, unpredictable nature of human society.

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