Tesla has put its cost-cutting strategy into reverse.
The automaker, after cutting prices several times in the past few months, has increased the cost of the Model 3 and Model Y in the United States, raising both by $250.
It’s a small raise compared to the recent drops, which have lowered prices by thousands of dollars, but it’s a still a policy shift. Tesla has adjusted its prices frequently of late to stoke demand and account for shifting market conditions, much like airline prices fluctuate.
Since January, the company has cut prices five times.
The higher price is not restricted to domestic markets. Tesla also increased the price of both models in China. And some vehicles in Japan and Canada are also slightly more expensive as of Tuesday.
Tesla’s recent price cuts have succeeded in their mission to increase consumer interest in the automaker. After the company cut the prices of its Model S luxury sedan and its Model X SUV in March, Tesla CEO Elon Musk said the price reductions had a “big effect on demand, very big.”
Beyond driving bargain hunters, Tesla has reduced prices this year to account for stricter U.S. standards, which it says will reduce the $7,500 tax credit that’s currently available for the Model 3.
The moves have had an impact among many competitors. Several automakers are becoming more price competitive as consumer interest in electric vehicles continues to grow. Ford, for instance, has lowered the price of the Mustang Mach-E by an average of $4,500 per car.
Whether they’ll follow the company’s lead in increasing prices, though, remains to be seen.
Tesla shares moved almost 2% higher in early trading Tuesday following news of the price adjustments.
