The Cheapest Model 3 Was Just Replaced By Something Better and Cheaper
The base Model 3 already didn't make sense, price-wise, and now it's gone.
How can it be that Tesla, in discontinuing its least-expensive Model 3—the Model 3 Standard Range—has replaced it, effectively, with something even cheaper but with more range? Easy: the formerly next-level-up, rear-wheel-drive Model 3 Long Range Tesla recently reintroduced to the lineup qualifies for the $7,500 Federal EV tax credit, which effectively lowers its $44,130 MSRP below that of the now-dead Model 3 Standard Range's $40,630 MSRP, which did not qualify for the same credit.
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How? The Model 3 Standard Range's battery is an LFP (lithium iron phosphate) unit sourced from China, rather than the NCA (nickel cobalt aluminum) style produced here in America. The China-sourced LFP batteries not only disqualified the Model 3 Standard Range from the EV tax credit, it likely soon would become more expensive to import those batteries thanks to the Biden administration's newest tariffs on certain EV tech flowing stateside from China.
Had Tesla kept the Standard Range around, Chinese batteries and all, it'd likely have needed to raise the car's price, absurdly, to near or above the NCA-battery Model 3 Long Range variant, despite that version qualifying for the tax credit and delivering an additional 91 miles of claimed driving range (363 miles vs. 272). Seeing as how this makes little sense, it's little wonder Tesla simply axed the Model 3's Standard Range variant entirely, though we suppose the price leader could return in the future with an NCA battery that qualifies it for the federal tax credit, thus returning it to its position below the larger-capacity Long Range model.
For now, the Standard Range's departure leaves the $44,130, 363-mile Model 3 Long Range RWD (rear-wheel drive, single-motor); the $49,130, 341-mile Model 3 Long Range Dual Motor (all-wheel drive, front and rear motors); and the $56,630, 303-mile and more powerful Model 3 Performance (also all-wheel drive, dual motor)—all of which qualify for the $7,500 Federal EV tax credit. A 363-mile Model 3 for effectively $36,630 is a screaming deal, given the Model 3's latest updates that include sleeker styling, a massively improved interior, extra standard features (like rear-seat display and heated outboard rear seats), and significant improvements to ride refinement and cabin noise. Given all that, unless the Standard Range returns with a price that undercuts its cheaper, better successor model, it won't necessarily be missed.
A lifelong car enthusiast, I stumbled into this line of work essentially by accident after discovering a job posting for an intern position at Car and Driver while at college. My start may have been a compelling alternative to working in a University of Michigan dining hall, but a decade and a half later, here I am reviewing cars; judging our Car, Truck, and Performance Vehicle of the Year contests; and shaping MotorTrend’s daily coverage of the automotive industry.
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