Tesla has announced the return of the “standard range” trim level for its Model S and Model X vehicles, offering buyers a more affordable option with lower battery capacity and driving range. The move comes amid a series of price cuts across Tesla's lineup, as the electric car maker faces increasing competition from other automakers.
The standard range Model S and X are now available for $78,490 and $88,490 respectively, down from $88,490 and $98,490 for the next higher trim level, which is called “long range”. The standard range models have an estimated range of 320 miles and 269 miles respectively, compared to 405 miles and 348 miles for the long range models. The standard range models also have slightly slower acceleration and lower peak power than the long range models.
Tesla had previously offered standard range versions of the Model S and X, but discontinued them in 2021 when it launched the “Plaid” versions, which are high-performance variants with more power, speed and range. The Plaid versions start at $129,990 for the Model S and $119,990 for the Model X. According to Tesla's website, the standard range models use the same battery pack as the long range models, but have a software lock that limits their capacity. This means that Tesla could potentially offer owners the option to unlock more range for an additional fee in the future.
Tesla's decision to reintroduce cheaper versions of its flagship vehicles could be seen as a response to the changing market dynamics in the electric car industry. Tesla is facing more competition from both established automakers and new entrants, who are launching more electric models at various price points and segments. Tesla has also been cutting prices of its more mass-market vehicles, such as the Model 3 and Model Y, in several markets, including China, where it faces regulatory scrutiny and consumer complaints.
Tesla's CEO Elon Musk has said that the company's goal is to make electric cars affordable and accessible to as many people as possible. However, some analysts have questioned whether Tesla can maintain its profitability and growth while lowering its prices and margins. Tesla reported a record net income of $1.14 billion in the second quarter of 2023, but its automotive gross margin declined slightly from 26.5% to 25.8%. Tesla also faces supply chain challenges and production delays due to the global chip shortage and other factors.
The standard range Model S and X are expected to ship from September in the US, according to Tesla's website. Buyers who are interested in these models can order them online or through the Tesla app.