Tesla’s Website Confirms Discontinuation of Most Affordable Model 3 Variant in the US – Reuters

Tesla’s affordable Model 3 compact sedan is no longer available for order in the US, according to reports citing the electric vehicle maker’s website. This development follows the recent increase in tariffs on imports from China, which now includes a 100% tariff on electric vehicles and a 25% levy on electric vehicle batteries and essential minerals.

Additionally, new US regulations have rendered cars containing Chinese-made components, such as lithium iron phosphate (LFP) battery cells, ineligible for the $7,500 federal tax credits for electric vehicles. The standard Model 3 rear-wheel drive option, priced at $38,990, uses LFP cells that are sourced from China.

This news comes on the heels of Tesla reporting disappointing third-quarter delivery numbers despite efforts to attract customers through price reductions and new incentives. Tesla delivered 462,890 cars between July and September, which represents a 6.4% increase from the previous year but fell short of Wall Street’s expectation of 469,828 units.

CEO Elon Musk has previously stated that Tesla aims to boost its annual deliveries beyond last year’s record of 1.8 million vehicles. However, to achieve this goal, the company will need to see exceptional delivery numbers in the fourth quarter to avoid a decline in overall annual deliveries.

Tesla has been responding to competitive pressures and declining consumer demand by reducing prices and introducing zero-interest financing, particularly in China—a key market that contributes approximately one-third of its sales.

On Wednesday, Tesla’s shares experienced a dip after a recent surge driven by excitement surrounding the unveiling of the company’s new robotaxi on October 10. There are high expectations that this event will signify a shift in the company’s focus towards artificial intelligence-powered autonomous driving. Earlier this year, Musk emphasized that Tesla has evolved into “an AI, robotics” company.