After steadily increasing prices over the past couple of years,

has cut them drastically across its lineup in the US and Europe, in an apparent bid to boost sales. The least expensive EV, the Model 3 RWD, has dropped from $46,990 to $43,990, while the 5-seat Model Y Long Range fell 20 percent from $65,990 to $52,990. That means the latter model now qualifies for the $7,500 US Federal Tax credit, so the final price drop will be $20,500 — over 30 percent. 

All other models, including the Model S and Model X (both regular and plaid versions) and the performance versions of the Model 3 and Model Y saw price cuts. However, the 7-seat option on the Model Y has increased in price by $1,000 to $4,000. While that puts the price over $55,000, it still qualifies for the Tax Credit as it's considered to be an SUV. In Germany, Model 3 and Y prices were cut by one to 17 percent, and also dropped in Austria, Switzerland and France.

To receive the full $7,500 rebate, customers will have to order before mid-March, when it's expected to be reduced to half that. The tax rebates apply to SUVs priced below $80,000 and cars under $55,000. The Model Y fell into both categories, depending on the number of seats, meaning certain 5-seat models weren't eligible — something CEO Elon Musk called "messed up." Now, all Model Y

except the Performance version appear to qualify.  

Late last year, it was reported that Tesla inventory was building up after years of strong sales, first with reports in China, then the US. Tesla recently cut prices in China, then later declined any compensation to customers who complained. The Model 3 now starts at 229,900 yuan ($33,425) in that nation. 

Neither Tesla nor CEO Elon Musk have weighed in on the price cuts, but potential buyers will no doubt be pleased (and recent purchasers displeased). The Model 3 was originally supposed to cost $35,000 and shipped in that configuration for a short time, but saw steady increases to the $46,990 price announced in March 2022. Last month, Musk said that "radical interest rate changes" had affected vehicle affordability and that Tesla could potentially lower prices.

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