Tesla Model 3 Boosts Electric Cars Sales

A little less than three years after Tesla unveiled the Model 3 to the public in March 2016, the company has finally delivered on its promise to offer the base version of it for just $35,000. Back in 2016, Tesla CEO Elon Musk said that customers would “not be able to buy a better car for $35,000” and that it was going to be one of the safest cars in the world. While the first claim is up for debate and arguably a question of personal taste, the second one has since been backed up by NHTSA safety tests, where the Model 3 scored outstandingly well.

In order to bring the Model 3’s base price down to $35,000 and realize an average price reduction of 6 percent across its entire model line-up, Tesla is closing most of its retail locations and moving to an online-only sales model starting immediately. To make up for the lack of test-driving opportunities that comes with the full commitment to online distribution, Tesla is also introducing a new return policy that allows any customer to return his newly-purchased car within 7 days or 1,000 miles for a full refund.

Considering how well the Model 3 has been selling at current (often significantly higher) prices, it will be interesting to see what the $35,000 starting price will do to demand for what is already the most popular electric vehicle in the United States by far. In 2018, Tesla sold nearly 140,000 Model 3 units in the U.S., meaning that, out of the gates, the first “mass-market” Tesla accounted for 39 percent of plug-in electric vehicle sales.