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Tesla Offering an Urgent $7,500 Discount May Not Necessarily Be a Demand Problem

Tesla Offering an Urgent $7,500 Discount May Not Necessarily Be a Demand Problem

A number of Tesla observers today think that since Tesla is offering these huge $7,500 discounts the demand may be falling. But I don't see a problem with Tesla offering an urgent discount before Dec. 31, and here is why.

Tesla has been rising the prices of its Model Y and Model 3 vehicles in the past two years. Tesla demand was strong. Plus, there were parts shortages due to supply chain issues. Tesla took advantage of all of these factors and raised prices of its electric vehicles.

Now perhaps the parts supply chain issue is solved and Tesla has leverage, lowering prices of its electric vehicles and taking advantage of the end of month, end of quarter and end of situations.

Tesla is basically playing smart, incentivizing its potential customers so they don't have to wait until January 2023 to take the delivery of a new Tesla.

As one person commented on Twitter "People just honestly forgot that they've raised prices by 40% in some to bring the price down 10-15% is just another lever they can pull. What are people gonna say when the prices go back to launch price and Tesla still makes margins?"

Armen Hareyan is the founder and the Editor in Chief of Torque News. He founded in 2010, which since then has been publishing expert news and analysis about the automotive industry. He can be reached at Torque News Twitter, Facebok, Linkedin and Youtube.