Tesla Postponed Price Hikes Because of Overwhelming Number of Last Minute Orders
Tesla’s not making it easy for everyone to place orders for its modelsby Kirby Garlitos, on LISTEN 04:23
Tesla has put a stay in its decision to raise prices on most of its models worldwide due to what it described as “unusually high volume” on orders being placed on its website. The slight price adjustment was supposed to take effect midnight Pacific Time last Monday, March 18. Now, the price hike will happen midnight Pacific Time on Wednesday, March 20. The decision to raise prices by three percent on some of its models was announced last week after Tesla abruptly reversed course on its plan to close all of its retail stores and focus all sales online. With the deadline fast approaching, it’s gonna be interesting to see if Tesla experiences the same “unusually high volume” when the clock hits midnight Pacific Time today.
Why are you confusing us, Tesla?
It’s not enough that a three-percent price hike on most of its models is imminent, but to do it in the middle of reversing course on a strategy you already implemented last month? That’s one way to make a mess out of your current situation. For those who don’t know, Tesla announced last February that it was lowering prices by six percent on all models as part of a bigger decision to close most of its stores and with to an online-only sales model. At that time, Tesla said that these changes were made to cut operating costs, paving the way for orders to be taken in for the base version of the Tesla Model 3.
Two weeks after that announcement, Tesla abruptly shifted its strategy, choosing to keep some of its retail stores open and raising vehicle prices by three percent to make up for the operating costs of these retail stores. In a matter of two or so weeks, Tesla dropped the prices of most of its models by six percent and then raised them again by an average of three percent. Confused yet?
The increase was set to take place last Monday, March 18. But because the company — in its words — said that it had experienced “unusually high volume” of orders, it decided to postpone the price hike until Wednesday, March 20.
While not all Tesla vehicles are subject to the price increase — the $35,000 Tesla Model 3 Standard Range and the Tesla Model 3 aren’t affected by the price bump — those who are looking to buy other versions of the Model 3, or even Model S and Model X, should expect to see an increase of around $1,000 to $3,000 on the prices of these vehicles.
I understand the moves Tesla is making from the perspective of finances. By shuttering all of its brick-and-mortar retail stores, Tesla would be able to save money to build the entry-level, $35,000 Model 3 Standard Range. There was even talk of passing on some of the savings from the six-percent decrease in prices to lower the costs of owning a Model S and Model X. Sure, it came at the cost of angering some customers who paid more for their Teslas before the price cut came into effect, but it was easy to understand if you’re looking at it from a business perspective. But as it turns out, even Tesla wasn’t completely sold on its plan to close its physical stores down as the subsequent strategy U-turn came about less than two weeks later.
Now, prospective Tesla customers would have to pay more to buy non-Standard Range versions of the Model 3, as well as the Model S and Model X.
Some retail stores will remain open because of it, but the pancake-style flip-flopping isn’t going to win Tesla any goodwill from its customers.
At the very least, we could chalk it up Tesla having one too many things on its plate in recent weeks. It did just debut the Model Y crossover last week, so it’s dealing with the major fallout from that unveiling. Perhaps Tesla was dealing with a lot of items that may have caused this brain fart. That’s possible. I can understand that, but that’s me having an understanding of what’s going on within Tesla.
But try telling that to the average consumer who just wanted to buy a Tesla. At first, he thought he could get it for cheaper, but now he’s going to have to pay more than what he expected because Tesla changed its mind so quickly after deciding on an important course of action? The optics are horrible if you look at it from that lens.
In any event, the price hike takes effect midnight Pacific Time on Wednesday, March 20. Let’s see if Tesla’s website once again experiences “unusually high volume” when the clock strikes 12.
Tesla Model Range
|Range||Top Speed||0-60 mph||Price|
|Tesla Model Y Standard Range||230||120 mph||5.9 seconds||$39,000|
|Tesla Model Y Long Range RWD||300||130 mph||5.5 seconds||$47,000|
|Tesla Model Y Long Range AWD||280||140 mph||4.8 seconds||$51,000|
|Tesla Model Y Performance||280||150 mph||3.5 seconds||$60,000|
|Tesla Model X Long Range AWD||295||155 mph||4.7 seconds||$88,000|
|Tesla Model X Performance||289||155 mph||2.8 seconds||$104,000|
|Tesla Model S Standard Range||270||140 mph||4.2 seconds||$69,750|
|Tesla Model S Long Range||335||155 mph||4.1 seconds||$73.750|
|Tesla Model S Performance||315||155 mph||3.0 seconds||$89,750|
|Tesla Model 3 Standard range RWD||220||130 mph||5.6 seconds||$26,950|
|Tesla Model 3 Standard Range Plus RWD||240||140 mph||5.3 seconds||$28,950|
|Tesla Model 3 Long Range RWD||325||140 mph||5.0 seconds||$34,950|
|Tesla Model 3 Long Range AWD||310||145 mph||4.5 seconds||$38,950|
|Tesla Model 3 Performance AWD||310||162 mph||3.2 seconds||$49,950|
Read our full review on the 2020 Tesla Model Y.
Read our full review on the 2017 Tesla Model X.
Read our full review on the 2018 Tesla Model 3.
Read our full review on the 2018 Tesla Model S.