Tesla to Discontinue Production on Cheapest Iteration of Model S

Tesla has announced that it will be discontinuing the lowest priced Model S as the firm’s previously affordable option. Apparently, Tesla is no longer selling the rear wheel drive iteration as of this Sunday though it will proceed with production of the rest of the Model S line-up such as the 75D, 100D, and P100D models. The discontinued version started at $69,500. The inventory is going to have to be sold out ending the production line for good. The dual motor 75D will take up its mantle of being the cheapest model at $74,500.

Source: MarketWatch

Model 3 to be the Sole Rear Wheel Drive Option

That would imply every Model S and X is going to come available with one motor on each axle. The only rear wheel drive Tesla is going to be the entry-level versions of the Model 3. Interestingly, the move to discontinue the S 75 was first announced by Tesla in July when it dropped the price by $5000. As such, the removal of the S 75 from the line-up follows discontinuation of the S 60 and 60D models during April and this at the time was one of the least expensive Model S alternatives.

Source: CarBuzz

As with streamlining the EV line and making every Model S alternative all-wheel drive while also knocking the low-end Model S choices would be done so as to carve out a large separation between the Model 3 and Model S lines. Tesla, CEO Elon Musk was quick to state that he expects to offer all-wheel drive iteration in the future. He also claimed there was some customer confusion that the Model 3 was actually an improvement over the Model S when actually, the model 3 was just a less expensive and completely different vehicle.

The Model 3 happens to be rear wheel drive. It is sold along with a 50 kWh battery pack which gives a range of about 220 miles or a long range, or a 75 kWh option which would allow for 310 miles. It would make better sense for Tesla to create the Model 3 as the cheaper vehicle. So that if one wants better luxury, then they would upgrade to a more expensive Model S version. There are some buyers who have even claimed that the company’s reps were encouraging them to spend more on the Model S as opposed to the Model 3 though Tesla has obviously denied the allegations.

Source: CarBuzz

Tesla Pricing Habits

This is not the first time that Tesla has changed the pricing on its models as it has culled the lowest tier of the Model S more than once in the past. However, this time, it appears to be more philosophical. The company is in the early phases for ramping up production concerning the Model 3 and in spite of the heavily advertised $35,000, the model may easily be round up to cost 40,000 or 50,000 dollars depending on how things go.

Of course, there are benefits when it comes to cutting the S 75 from the production line. On the other hand, considering the apprehension of the Tesla CEO on market confusion between the Model 3 and S, it is not a surprise there happens to be a bigger distinction at the present as concerns the Model 3 and the cheapest version of the flagship model.