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Tesla Backtracks on Store Closures; Raises Prices 3% Instead

$35K Model 3 exempt from price increase.

by on Mar.11, 2019

Tesla announced it will only close half of its stores and offset that by raising prices 3%.

Tesla buyers looking to walk into a store to buy a new vehicle were disappointed recently when Chief Elon Musk said the company would close the stores to cut costs — now they can rejoice.

In a blog post, the company announced it would only close about half of the stores across the country, after a spate of negative feedback about the move initially.

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“Over the past two weeks we have been closely evaluating every single Tesla retail location, and we have decided to keep significantly more stores open than previously announced,” the electric carmaker said. 

So how will it recoup those costs?

(Tesla ready to reveal Model Y, pickup later this year. Click Here for the story.)

The Tesla Model S gets a 3% price hike to help increase revenue.

“As a result Tesla will need to raise vehicle prices by about 3% on average worldwide.” Wannabe Tesla owners have a week – until March 18 – to place their order before the price increase takes effect.

The price hike impacts only the Model S and Model X as well as the more expensive versions of the Model 3. The entry-level, $35K Model 3 is exempt, the company noted. The Model S and Model X models are priced starting at $79,000 and $88,000 before applicable tax credits.

(Click Here) for details about Musk’s declaration Tesla will have a driverless car by the end of the year.)

Although some stores will remain open, “all sales worldwide will still be done online, in that potential Tesla owners coming in to stores will simply be shown how to order a Tesla on their phone in a few minutes.”

The company is counting on its seven-day, 1,000-mile (whichever comes first) return policy to mitigate the need for test drives. However, the stores that will remain will have some vehicles available for test drives. Additionally, they will have some back stock available, the company notes, so that buyers can conceivably walk up and drive off in a new Tesla.

(Tesla now selling $35K Model 3; selling vehicles online only. Click Here for the story.)

The news comes at the aforementioned Musk is staring down an end-of-day deadline to answer questions raised by the Securities and Exchange Commission about recent tweets he sent that may violate the terms of its fraud settlement with the agency.

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One Response to “Tesla Backtracks on Store Closures; Raises Prices 3% Instead”

  1. Allen says:

    ““Over the past two weeks we have been closely evaluating every single Tesla retail location…”". The stores were evaluated after Tesla decided to close them? One would think that would have been thought out well before the decision to close them.