Tesla announced that it is getting rid of their cheapest models of its Model S sedan. The news comes just a few months before the planned introduction of the less expensive Model 3, the sedan the company aims to sell to the masses.
As reported by Los Angeles Times, the electric-powered Model S sedan ranges in price from $64,000 to $128,000. The price is connected to the battery packs, meaning the higher the price, the more powerful the battery pack. The discounted 60 and 60D models have a stated range of 210-218 before a recharge is necessary. According to Tesla, the decision to drop these models is because they are not selling very well, and they want to simplify the order process as well. Customers will be able to order them until April 16.
As speculated, the other reasons that Tesla is dropping the 60 and 60D is the fact that they could compete with the Model 3, which is Tesla’s car for the masses. It has an expected base price below $40,000. Top of the line versions are expected to cost up to $50,000 and most early adopters will surely want their cars fully loaded. The next tier of Model S is the 70 and 70D and their price ranges from $70,000 to $75,000. Both cars have a range of around 250 miles. Top of the line P100D has a price tag of $128,000 with 300 miles of battery range.
According to Market Watch, last week the company raised $250 million in common shares and $850 million in convertible notes to help with the Model 3 launch. Some analysts think that the smaller deal is a sign of confidence in the Model 3 rollout, while others are still concerned with Tesla’s spending habit. The Model 3 is a vital element to the company’s expansion goals, which include increasing their production to a rate of half a million vehicles by the end of the year.