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Following Recent Price Cuts Tesla Model 3 & Y Now Qualify For Germany’s €6,750 EV Incentive

Following the recent price cuts in Germany, which reduced the Model 3s starting price by 6000 euros and the Model Y's starting price by 9,100 euros, the company's best-selling vehicles now qualify for an EV incentive in the country. According to Tesla, now both the Model 3 & Y qualify for the full €6,750 EV Incentive.


Tesla recently implemented a steep price cut across the company’s vehicle lineup and covering all geographical regions. Tesla’s first price cut happened on January 6 in China where the EV maker lowered the price of the Model 3 by 13.5% to $33,500 and the cost of the Model Y by 10% to $38,000.

And on January 12 Tesla followed up by cutting prices worldwide including in North America, Europe, and the rest of Asia. The largest of the price cuts occurred in the US where some variants of Tesla’s vehicles saw price cuts as high as 20%.

The price cuts have allowed some of the most popular versions of Tesla’s vehicles like the Long Range Model Y to qualify for the $7,500 US Federal EV tax incentive. Now, taking into account the incentive, the starting price for the Model Y in the US is $47,500 down from $66,000 a week prior.

Related News: Tesla Just Raised Prices on the Model Y - Why This Was a Good Thing

The 20% price cut making the Model Y qualify for the US Tax rebate, and the tax incentive decreasing the price by a further 10%, has meant that the Model Y now costs 30% less.

And following on this trend, Tesla has also cut its vehicle prices in Germany which once again made the company’s vehicles eligible for tax incentives bringing the vehicle prices even lower.

Following the price cuts in Germany, the Model 3’s starting price saw a 6000 euros reduction and as of last week starts at 43,990 euros. and the price of the rear-wheel-drive Model Y saw a 9,100 euros reduction to 44,890 euros.

And today in a press release shared by Electrek, Tesla confirmed that the recent price cuts have qualified the Model 3 and Y for subsidies in Germany.

Tesla writes “as BAFA officially confirmed at the end of last week, both the Tesla Model 3 and, for the first time, the Tesla Model Y qualify for the highest premium of the new state subsidy, which will be up to €6,750 in 2023 (BAFA + manufacturer’s share). For both Model 3 and Model Y, the maximum subsidy applies to all model upgrades, including the maximum range and performance variants.”

And following the new subsidy Tesla says “combined with recent price adjustments, the new maximum subsidy for all variants of the Model 3 and Y allows even easier access to owning a Tesla, in line with our mission to accelerate the global shift toward sustainable mobility. The Tesla Model 3 is available from €40,470 with the maximum subsidy, and the Model Y from €41,370.”

This brings the total price reduction for Tesla vehicles in Germany to more than 20%. And given that Tesla is in the process of massively increasing vehicle production, these price cuts should allow Tesla to increase demand by making its vehicles affordable to a much larger swath of the population.

Currently, since most of Tesla’s price cuts and subsidies are just starting to take effect, beyond anecdotal evidence, it’s difficult to speak with any certainty on how the recent moves are affecting demand for the company’s vehicles.

However, we will be sure to keep you posted once we learn more about Tesla’s demand in the coming months. Until then, make sure to visit our site regularly for the latest updates.

So what do you think? Excited that now both the Model 3 and Y qualify for incentives in Germany? How do you think it will affect demand for Tesla vehicles going forward? Let me know your thoughts in the comments below.

Image: Courtesy of Tesla, Inc.

For more information check out: Hundreds of Front Giga Castings Outside Giga Berlin - Model Y Production In Full Force

Tinsae Aregay has been following Tesla and The evolution of the EV space on a daily basis for several years. He covers everything about Tesla from the cars to Elon Musk, the energy business, and autonomy. Follow Tinsae on Twitter at @TinsaeAregay for daily Tesla news.