Tesla walks back its plan to close most showrooms

Ann Santiago
March 12, 2019

Tesla made a controversial decision last month when it announced that it would be closing all of its stores and going online only for sales of its EVs. Of course, anyone ordering a Tesla to their home sight unseen will be able to return the auto after 1,000 miles or seven days (whichever is first) thanks to the company's new return policy announced last month. The company will evaluate the performance of approximately 20% store locations over the next few months before determining if they should remain open or close.

However, there will be no price hike for the cheapest Model 3, which is its cheapest vehicle with a starting price of $35,000 in the U.S., around £26,400 in the United Kingdom - although prices for Britain are yet to be confirmed.

The company stressed that its lowest-priced EV, the $35,000 Model 3, will not get a price hike. There won't be a price increase to the $35,000 version of the Model 3, though costlier variants will be made more expensive.

Potential Tesla owners will have a week to place their orders before prices rise, so current prices are valid until March 18th. The company said that the 10% of stores it had recently closed weren't performing and would've been closed anyway. Some of the stores that have already closed will be reopened with fewer staff members.

American electric vehicle maker Tesla has raised auto prices by an average 3 percent, worldwide.

Tesla Inc. said it plans to raise average vehicle prices by about 3 percent globally after reversing a decision to shut down most of its stores. The company also has a list of about one hundred stores that it's evaluating: Some will close and others will stay, it says.

Tesla said that sales would still be conducted online with potential buyers "coming in to stores will".

Remaining stores could have fewer workers but will have vehicles available for test drives and a small inventory in case people want to buy immediately, the statement said.

The case is the latest major challenge by authorities to Musk's leadership as Tesla seeks to make good on his promises to Wall Street that it will soon by consistently profitable and will not need more capital. The 7-day/1,000 mile test drive policy will still apply as well, though test drives will still be available in stores.

CleanTechnica spoke to several retail store employees after the news of Tesla closing retail stores went out and the sentiment was universally unsettled. Buyers coming into stores will be able to do a test drive, and if they choose to buy a auto, they'll be shown how to do that on their phones.

In announcing the move on February 28, CEO Elon Musk said it was necessary to cut costs in order to profitably sell the mass-market version of the Model 3 sedan for $35,000.

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