Confirmed: Tesla Increases Pricing For Base Model S By $2,000

NOV 12 2016 BY JAY COLE 24

Recently we put forward some speculation that Tesla would soon be increasing the base cost of its Model S 60 offering, based on a source on Reddit with a history of accuracy in predicting Tesla’s future actions.

Tesla's "November Updates" doesn't include a lot of good news for future owners

Tesla’s “November Updates” doesn’t include a lot of good news for future owners

And sure enough, tucked in the bottom an email sent out last night by the company that also touched on the recent changes to its Supercharging Network (now pay-as-you go after 400 kWh of annual usage for new owners after January 1st) and the offering of new self-driving hardware on all EVs, Tesla has indeed increased the entry level 60 kWh S sedan’s pricing by $2,000 – effective November 22nd.

Price Increase for Model S 60

On November 22, 2016 the base price of Model S 60 will be increasing by $2,000. Now is the time to get behind the wheel of a Tesla for as low as $737/month (details here). The Model S 60 can drive up to 218 miles on a single charge and accelerates from zero to 60 mph in just 5.5 seconds.

Currently, the Model S 60 starts from $66,000, but will jump to $68,000 shortly.

It is interesting to note that Tesla only re-introduced the 60 kWh Model S this past June, so it appears the model and original pricing may have been put in place solely in an effort to boost Tesla sales, in order to hit earlier strong guidance of ~80,000 EVs sold globally in 2016.

The question now is whether or not the price change is to allow more competitive room for the Model 3 in the future, to increase the margins on the base car…or does it foreshadow the remove of the entry level option altogether in favor of the 75 kWh version; which from $74,500 kind of seems like a no-brainer now if you are set on buying a Model S.

Full copy of Tesla’s November Updates email below:

Tesla Supercharger

Tesla Supercharger

An Update to our Supercharger Program

Four years ago, Tesla introduced the Supercharger Network – the world’s fastest charging solution – to enable convenient long distance travel. Today, more than 4,600 Superchargers allow over 160,000 Tesla owners to drive all over the world.

We recently announced a change to the economics of Supercharging – one that allows us to reinvest in the network, accelerate its growth and bring all owners, current and future, the best Supercharging experience.

Any Tesla ordered by December 31, 2016 will continue to benefit from free unlimited Supercharging. For Model S and Model X vehicles ordered after January 1, 2017, 400 kWh of free Supercharging credits (roughly 1,000 miles) will be included annually so that owners can continue to enjoy free Supercharging during travel. Read the blog.

All Tesla Cars Now With Full Self-Driving Hardware

All Tesla vehicles produced in our factory now have full self-driving hardware, enabling a rapidly expanding set of new Autopilot features to be introduced over time. While active safety features continue to come standard in all Teslavehicles, customers can now choose from two new Autopilot packages: Enhanced Autopilot, which is an advanced suite of driver-assistance features, and Full Self-Driving Capability which will ultimately take you from home to work and find a parking space for you on its own.

Tesla's new self driving hardware/360 degree vision to allow for future Level 5 autonomy

Tesla’s new self driving hardware/360 degree vision to allow for future Level 5 autonomy

Self-driving vehicles will play a crucial role in improving transportation safety and accelerating the world’s transition to a sustainable future. Once the software is extensively validated and there is regulatory approval, full autonomy will enable a Tesla to be substantially safer than a human driver. It will also lower the financial cost of transportation for those who own a car, while providing low-cost on-demand mobility for those who do not. Read the blog.

Price Increase for Model S 60

On November 22, 2016 the base price of Model S 60 will be increasing by $2,000. Now is the time to get behind the wheel of a Tesla for as low as $737/month (details here). The Model S 60 can drive up to 218 miles on a single charge and accelerates from zero to 60 mph in just 5.5 seconds.

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24 Comments on "Confirmed: Tesla Increases Pricing For Base Model S By $2,000"

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Never shy with price increases, I expect the model 3, will be $60,000, with the “Options”
you will need/want!

2012 Model S 60 started at $70k without lifetime access to the supercharger Network.

There have been dozens of upgrades including standard autonomous drive hardware and better seats. And 2017 Model S 60 will still be $2k cheaper.

Nobody will “need” anything more than a standard $35k Model 3.

Almost everybody will “want” a fully loaded all wheel drive performance $80k Model 3.

I hope you are right, Rob, that the base III will in fact sell for $35,000. I just don’t think Tesla can build a car with Tesla quality, Tesla quickness and Tesla panache for $35k. I am hoping it will be under $40k, but I wouldn’t bet my mortgage payment on it being that low.
Second part of my concern is that the base III probably won’t show up until late 2018 or early 2019. The S was 6+ months late and I don’t see the III doing any better on that front.

Holy whine fest. It is like you don’t think Toyota can make an inexpensive Camry because they also make a $85,000 dollar Lexus GS F and a $90,000 dollar Lexus LX SUV.

Or that GM can’t build a $37,500 dollar Bolt, because they also build $75K Escalades and $85K CTS-V’s

Stop the silly talk.

Yup. Just as silly as all the talk before the M≡ Reveal that it was basically gonna be just a 20% smaller Model S.

It really is amazing how many people seem to think that an auto maker which has previously made only “premium” cars will be unable to make a significantly less expensive one.

“On November 22, 2016 the base price of Model S 60 will be increasing by $2,000.”

Since there’s no mention of other models’ (especially the S 75) price increase, I guess it’s safe to assume that adjustment for inflation has nothing to do with this announcement.

I wonder if the $9000 fee for a later full battery unlock will remain unchanged, just to force buyers to go for the 75 in the first place.

I guess we’ll find out in 10 days ..

disappointed — Drama Queen much?

As “low” as $737. Hahaha

Ever since that new VP of Finance came on board, prices have gone up all over…

Optional equipment (e.g. rear facing seats) went up (TWICE!).

Supercharging. You’d think if the customer is getting charged (to charge), they should reduce the vehicle price by $2000.

Service center will never be a profit center. Yet Model X customers were being ripped off (e.g. overpriced windshield) until folks complained to the media.

Autopilot now costs more. Future software unlock for full autopilot will cost even more.

Now base price. It starts with the Model S 60. Later, I’ll be the rest will go up too.

This likely means only the most barebones of the Model III will be priced at Elon’s target, with optional equipment priced pretty high.

Getting a little put off by this trend. Love Elon but loving the company less.

Another Euro point of view
“Getting a little put off by this trend. Love Elon but loving the company less”. I would say the company is great and Elon’s vision is great, now I believe that at this stage of development of Tesla the negatives and positives of having Elon as CEO are more or less in balance. The positive being thus his vision and charisma, the negatives being lack of focus and, way more worryingly, the rather strong distrust that financial circles that matters (for ex. Goldman Sachs & Morgan Stanley) seem to have developed towards him since the merger with Solar city project. One does not raise cash on the markets and right after buy a loss making company and say it just occurred to you as a good idea. You do that then expect that reputable financial institutions will black list you for a long time. I believe this distrust might has way more far reaching consequences than EV enthusiasts here may think. Elon now says Tesla does not need a new equity raise but it is not the meager profits that can be now achieved (using not easily repeatable incomes such as ZEV credits in Q3) that will cover billions of… Read more »

Hope these little price increases, don’t cut into the increased volume goals, that Tesla wants to meet. We will find out how this helps the
Tesla Brand, become profitable, in the interesting times up ahead.

One should consider, that all those Model S 60 delivered until March 31.st 2017 will still come with free supercharger access for life (of the car).
Once it was announnced that this will no longer be the case for order after January 1st, the car probably became more interesting. So the natural thing to do in an environment where demand exceeds production capacity is to adjust the price.
Basic economics.

Besides they announce it to be coming into effect not immediately, but Nov. 22nd. Still time to buy a cheaper one if you consider it too expensive!
Any other company would have announced it as “effective immediately with the announcement”.

In Germany, the Model S is about to get the 4kEUR incentitives (50% government, 50% manufacturer) because they moved some stuff into packages so it meets the rules for the incentitives -> http://www.motor-talk.de/news/mit-staatlicher-unterstuetzung-zum-tesla-t5860620.html (German).
So at the moment it’s 1750EUR below the limit (the base price with the cheapest engine and without any packages (how much money you spend for packages doesn’t matter) and without VAT counts).

So if they increase the prices more close to the limit, they have more money for their part of that incentitive stuff (their part is 2kEUR)…

BTW: Before that started in Germany, Renault gave 5kEUR discount on the Zoe (started like 1 or 2 years before). When that incentitive started in Germany, Renault was “generous” and gave 1kEUR on top on that incentitive = no price difference, but the only difference is that now 2kEUR/Zoe are coming from the government 🙁

So I absolutely don’t understand why everybody was calling for such incentitives!

notting

The idea of using a government incentive to stimulate development of a new tech, or a green tech, is that it should benefit the manufacturer, so that (in this case) the auto maker is encouraged to develop and sell EVs.

I realize that as an EV enthusiast you’d rather that the money go into your own pocket than the manufacturer’s. But as far as stimulating growth of the EV industry, I think the direct subsidy to the auto makers will create faster growth than indirect subsidies, such as the ones in the USA which are merely tax rebates for the buyers.

I note that EV sales are growing faster in Europe than in the USA. Aside from the extreme case of Norway, is that coincidence? Perhaps… and perhaps not.

Well, Tesla may have timed things correctly As many of you know I’ve been agonizing over a new EV for years. My main desire was AWD, reasonable price, and most of my miles on EV mode. Salivatied over the Mitsubishi Outlander PHEV that never came. Loved the i3 but it doesn’t work for MN winter (got stuck on my test drive) I put down deposit for Model 3 the first second you could I love Volt and concept of Bolt but wanted AWD. Was thinking about compromise Well, I’m pulling trigger on Model S, 60D. A few reasons 1. The anti CAFE letter written by GM et al has pissed me off. Now I don’t want to support GM. That reduces my desire to compromise for a 2WD Volt/Bolt 2. $2,000 price increase says to me that 60D is going away soon (75D will be lowest model) 3. $8k for Autopilot on a model S means that a fully optioned Model 3 will cost more than a lower priced 60D. I don’t want to pay for all those bells. Thus even though my model 3 deposit was placed early, I won’t take delivery until late 2018 or early 2019… and… Read more »

I agree with you whole heartedly. I was going to buy the Bolt and cancel my Model 3 reaervation but after what GM did by signing that letter, I’ve decided to wait for the Model 3. But now I think I will go ahead and buy the Model 60 rather than wait.

Make sure to use an owners link for an extra $1K off the price. I have one if interested,

Congrats on your decision. I know you have been waiting a long time.

It has been suggested, and I think it likely, that the introduction of the new, lower-priced Model S60, and the now discontinued Model X60, were essentially end-of-quarter promotions used to — successfully — increase Tesla’s sales during one all-important quarter when Tesla needed to show a net profit. The X60 was discontinued immediately after the sales goal had been reached for the quarter.

It was always understood, at least by those who follow Tesla Motors closely, that the discounted price of the new S60 was a strategy by which Tesla traded off some of its profit margin to increase sales. So it should be no surprise that Tesla has chosen to increase the price. What is surprising, at least to me, is that Tesla didn’t increase the price at the same time they discontinued the X60.

I still think that this is a pre-cursor to the removal entirely of the S60 & 60D as a base model. No doubt that Tesla has a lot of tricks up their sleeves for the next few quarters until Model 3 starts delivering. They had a B.S. discount last quarter that Elon pretended not to know about in order to get rid of a lot of cars that had the old autopilot tech. We didn’t know that at the time, but it was clear to me now that they needed to flush out models that didn’t have the new cameras and video chips installed prior to their announcement, and also needed to shoot for their record last quarter. Now they likely have a tougher time hitting margin because all that tech had to increase costs of the cars. They also aren’t seeing people upgrade or unlock capacity, so they throw a teaser out there for a week or two “Buy by 11/22 and lock in the old price and unlimited supercharging” I must admit, it is tempted as a sales tactic. I’m tempted myself, but I’m still gonna hold tight none the less. I’d say that things remain much the… Read more »

Wow – so excited -I bit the bullet and ordered my S60D before the price increase!
I should be driving it in a few weeks.