Tesla cuts costs on its US fashions, shares slide

One of the great questions of the year ahead is ‘how will Tesla make money in 2026’ because right now it isn’t looking good. The company had a great Q3 in terms of sales but much of that was pull-forward due to the expiration of the $7000 federal US tax credit. That ended September 30 and now Tesla is cutting prices.

The base model Y is listed at $39,990 compared to $44,990, which is a $5000 price cut (or a $2000 price increase once you exclude the credit). The base model three is listed at $36,990 compared to $42,490 previously, a $5500 cut.

Shares are down 2.8% on the news.

Now this isn’t exactly an apples-to-apples comparison as these models are being called ‘standard’ models, which are stripped down versions of the prior ‘base’ models.

Elon Musk touted some kind of Tesla announcement today and it looks like this is it with the standard Model Y and Model 3 — not exactly game changers.

The other big obstacle for Tesla going forward is that regulatory credits are largely going away by 2027 and that was a big portion of their net profit last year.