Elon Musk announced the price of Tesla's Model 3 electric car during a unveiling event in 2016.

The cheapest Tesla Model 3 now costs $48,440

Washington DC

The more expensive Tesla car gets more expensive, while other electric cars sell as long as their price drops.

Tesla’s cheapest Model 3 is now selling for $46,990 after price hikes this month, making it an entry-level Model 3 34% more expensive than it was three years ago. Additional fees, some of which are industry standards, raise the total price of the Base Model 3 to $48,440.

The Model 3 was touted long before it was introduced in 2016 as an affordable car that costs around $35,000. The manufacturer’s suggested retail price for the least expensive option for electric vehicles like the Chevrolet Bolt and Nissan Leaf fell from 2019 to 2022, even before inflation was factored in. (Bolt dropped from $36,620 to $32,495 during that period, and the paper from $29,990 to $27,400.)

Tesla CEO Elon Musk said on Twitter SundayShortly before the recent price hike, Tesla was “recently experiencing significant inflationary pressure in raw materials and logistics.”

Tesla hasn’t seemed to suffer from its price hikes over the years, as the Model 3 was the world’s best-selling electric car in 2021, with about 540,000 units sold. Since the introduction of the Model 3, Tesla has become the world’s most valuable automaker, only years after facing questions about whether it would survive as a business.

But the price difference for what’s considered an entry-level Model 3 appears to be a deviation from Tesla’s original plans. (Tesla did not respond to a request for comment.)

Musk said in a 2013 interview with CNBC that the automaker would build a car for “around $35,000.” Tesla revealed the Model 3 in April 2016, with Musk saying, “In terms of price, of course it’s going to be $35,000.”

Tesla began delivering the Model 3 in July 2017 with more than half a million reservations for the $35,000 vehicle. But Tesla didn’t offer its first $35,000 Model 3s until April 2019.

Hardware from the $35,000 Model 3 matched the $39,500 version of the car, but Tesla used software to limit battery range and disable seat heating. The $35,000 Model 3 also shipped without the autopilot, Tesla’s driver assistance program, and is standard on today’s cheapest Model 3. right Now , The more expensive Model 3 has 52 more miles of range and a slightly higher top speed, 140 mph versus 130 mph. Aside from the price, the only apparent drawback in today’s cheapest Tesla cars is a slightly slower 0-60 mph time, 5.8 seconds versus 5.6 seconds. The $35,000 car couldn’t be purchased online either, which seemed to prompt customers to buy a more expensive car.

“It sounds a little bit more annoying, you just have to make a phone call or visit a store,” Musk said on a 2019 call with investors.

Musk described as early as 2006 that Tesla planned first to build a sports car, then an “affordable car,” then an “affordable car.”

Musk called out the plan at Tesla Battery Day in 2020. He described the Model 3 and Model Y as becoming “excellent mass-market cars.”

While the $35,000 Model 3 couldn’t be purchased at the time, Tesla promised lower prices.

“Our goal has always been to try to make an affordable electric car,” Musk said. “I think maybe about three years from now we’re confident we can make a very attractive $25,000 electric car.”

Musk said in January 2022 that Tesla is not currently working on a $25,000 vehicle.

At some point, Musk said. “But we have enough on our page now.”

Chris Isidore contributed to this report.

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