Surprise! Tesla's Model 3 now has a mid-range battery option

Ann Santiago
October 20, 2018

The Model 3 sedan now being offered by Tesla can travel about 260 miles between charges and costs $45,000, some $4,000 below the starting price of the sedan that the company began selling a year ago, excluding options and incentives. That model, however, remains delayed until 2019, the company said Thursday.

Tesla's website puts the new car's purchase price at $45,000 before fees and taxes.

While the Mid Range isn't the long-awaited $35,000 Model 3 Tesla CEO Elon Musk first announced two years ago (that model is still coming), depending on where you live the price of the vehicle can reach $35,000 or even lower after incentives.

"Costs $35k after federal & state tax rebates in California, but true cost of ownership is closer to $31k after gas savings", tweeted Musk.

With the arrival of the Model 3 Mid Range model, Tesla will no longer sell the rear-wheel drive Long Range version.

The company has long promised the Model 3 would be its vehicle for the masses, but it originally focused on building premium versions of the auto while it struggled to ramp up factory production.

With an estimated range of 260 miles, the mid-range ride has a battery with fewer cells than those in Tesla's previous versions of the Model 3.

The world still awaits the $35,000 sedan promised by Tesla founder Elon Musk back in March 2016.

While the automaker has battled production problems with Model 3 vehicles, in the third quarter Tesla said it produced 80,142 vehicles, of which 53,239 were Model 3 sedans.

The Mid Range comes with a single motor and rear-wheel drive whereas the Long Range and even pricier Model 3 Performance now come with dual motors and all-wheel drive exclusively. For example, NY offers a further $2,000 incentive, dropping the price down to $35,500.

Now there are three choices: The new one, the performance model, and a "long-range" version between the two. Musk has said that the company plans to offer a version of the auto that will have a base price of just $US35,000 before any tax incentives.

Hitting that price target is important, because the federal tax incentives - worth up to $US7,500 per auto - are due to start dwindling in January.

The release of a lower-priced Model 3 was a "logical next step", Evercore ISI analyst Arndt Ellinghorst said in a note.

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