Tesla to increase price of Model Y in Europe next month

When it rains in the US, it dripfeeds to Europe. The previously announced price hike for the world’s best-selling EV, the Tesla Model Y, reaches the continent’s shore. As of April, the price will rise by around €2,000.

Tesla’s pricing increase for the Model Y electric SUV in several European countries was announced via a post on X. The decision aligns with Tesla’s global pricing strategy adjustments and reflects the company’s response to the broader industry’s competitive dynamics, which it has had a strong influence on lately.

‘Cyclical consumer demand’

Prices were again adjusted downward as late as February, but the company appears to have become more cautious after Tesla’s stock value slumped due to dwindling margins caused by the price war.

Addressing the fluctuating prices, Tesla CEO Elon Musk highlighted the balancing act between manufacturing efficiencies and the cyclical nature of consumer demand. Musk’s commentary came in response to discussions on the social media platform X and emphasized the strategic considerations behind Tesla’s pricing adjustments.

In the US, Tesla already announced on its official website that, effective April 1st, it will implement a $1,000 price hike across all trims of the Model Y. This news followed a similar increase on March 1st, when Tesla elevated the prices of its Model Y rear-wheel drive and long-range variants. It remains unclear whether the forthcoming adjustment will be in addition to the March enhancements for these models.

Steady line-up

The increase strategy might also be explained by Tesla’s product cycle. As the company gears up for its next-generation, affordable electric vehicle, code-named ‘Redwood’, the coming year will focus on gaining market share and profitability with the current line-up. Also, Tesla’s price drops have chased away rental companies, who have backed out from large orders over tumbling residual values, affecting their profitability.

With 1.2 million units delivered, the Model Y was the best-selling car in the world last year. Sales rose by a massive 64% year-on-year. So much for “cyclical consumer demand”.


Ready to join the conversation?

You must be an active subscriber to leave a comment.

Subscribe Today

You Might Also Like