KEY TO REMEMBER
- Tesla shares fell after lowering prices of its Model 3 and Model Y vehicles in the United States to boost demand.
- The latest round of price cuts comes after Tesla reported lower deliveries forecast in the third quarter due to planned downtime at its plant. factories.
- Tesla regularly cuts prices to stimulate demand and defend its market share.
Shares of Tesla (TSLA) lost ground in early trading Friday after cutting prices for its Model 3 and Model Y in the United States to stimulate demand.
The electric vehicle maker reduced its prices by by about 2.7% to 4.2%, bringing the cost of its Model 3 rear-wheel drive to $38,990 from $40,240. The Model Y Performance SUV now starts at $52,490, up from $54,490.
The latest round of price cuts comes after Tesla reported lower-than-expected third-quarter deliveries due to planned downtime at its factories, factory upgrades in anticipation of the redesigned Model 3 sedan and Cybertruck contributing to production interruptions. Tesla delivered 435,059 electric vehicles in the third quarter, compared to 466,140 in the previous quarter.
Tesla shares were in down 2.4% in early trading at 9:36 a.m. ET Friday after the announcement, although they were still up more than 130% year to date.
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