Tesla will keep more stores open, increase vehicle prices instead

Tesla will keep more stores open, increase vehicle prices instead

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Tesla Inc’s high-end vehicles will go through on average price hike of about 3 percent as the electric carmaker is planning to keep more of its stores open than its earlier plans, company announced on Sunday.

The price hikes will not apply to $35,000 Model 3 which will remain unchanged, but the prices of more expensive variant of Model 3, Model S and Model X will increase worldwide, Tesla said.

The opportunity of placing orders at the old prices will still be available to potential buyers until March 18, said the carmaker.

Last month, in a bid to reduce its prices by about 6 percent on average, Tesla decided to shift all its sales from stores to online which also helped the carmaker to reach the $35,000 Model 3 price mark well before than it was expecting, and in a recent email to employees, the chief executive Elon Musk said that about 78 percent of Model 3 orders had already been made online.

After the current move, company’s previous cost saving plans by closing stores will now be coming with half of the effects as company is now closing half of the stores than planned numbers, it said.

Company will also reopen, with lesser crew members, few of its stores located in high-visibility areas but were closed due to lower sales, Tesla said.

In its recent announcement on Sunday, Tesla stated that it will continue working with its strategy of taking orders only online and the stores would mostly be serving the purpose of introducing its vehicles to potential buyers and guiding them to make a purchase.

The carmaker will keep the inventory low at its stores which will be carrying less number of cars available in case when customers immediately want to drive away with the Tesla car.

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I handle much of news coverage for tech stocks, and occasionally cover companies in different sectors. In the past, I've written for other financial sites and published independent investment research, primarily on tech companies. I have a B.A. in Economics from Columbia University. I'm based out of San Diego, but grew up in Southern New Jersey. I play basketball and tennis in my spare time, am a long-time (and long-suffering) fan of Philadelphia's sports teams, and alternate daily between using an iPad Air, a Galaxy Note 3, and one or two Windows PCs.

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