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Tesla Cuts Model 3 Pricing Yet Again in Quest for Magic $35,000 Figure

Tesla has cut the price of its Model 3 sedan again, bringing the cost of the cheapest variant down to $42,900 before account incentives and potential gas savings are taken into account. With those included, Tesla says, the price is $34,850.

Elon Musk’s automaker has already cut its prices once this year, back at the start of January, when it lopped off $2,000 to offset the impact of federal electric vehicle tax credits being cut.

Musk announced the new $1,100 cut in a late Tuesday tweet. It follows the company’s discontinuation last week of its customer referral program, which—as noted by Reuters—was costly due to benefits such as half a year of free supercharging for new customers.

Tesla has for a long time been trying to get the base price of a Model 3 down to $35,000 before incentives. When will that finally happen? Musk wasn’t naming dates when asked that question on Twitter.

Apart from axing its customer referral scheme, Tesla also recently announced it was cutting 7% of its full-time workforce, as it attempts to achieve the economies of scale it needs to hit the magic $35,000 figure.

The federal tax credit for electric vehicles was $7,500 until October last year when it was halved. In the middle of this year, it will be halved again to just $1,875, meaning the likes of Tesla need to dampen their pricing if they want to avoid customers being scared off.