Tesla Inc said on Wednesday it was lowering the price of its Model 3 sedan for the second time this year, moves that come in the wake of Tesla losing a tax credit that made its cars more affordable for US buyers.
The company is ramping up production of the Model 3 and trying to make it more accessible for mainstream car buyers. Tesla has also been cutting costs as it looks to turn in profits this year.
A US federal tax credit began phasing out for Tesla in January, effectively raising the price of cars by $3,750. Tesla said on Tuesday it had cut the Model 3 price by $1,100, following a cut of as much as $2,000 in January.
That leaves the starting price of a Model 3 at $42,900, still substantially above the $35,000 price Tesla Chief Executive Officer Elon Musk originally promised.
Musk told a Twitter user that the company is “doing everything we can” to drop the Model 3 base price to $35,000, without credits. “It's a super hard grind,” he wrote.
The billionaire in the past few months has been pushing for cost-cutting initiatives, like cutting jobs and ending a customer referral program.