Tesla (NASDAQ:TSLA) has stopped accepting orders for its lowest-priced Cybertruck model, originally listed at $61,000. The electric vehicle maker’s website now features the $100,000 version as the most affordable option for prospective buyers. The decision comes amid concerns about supply and demand dynamics for the highly anticipated electric truck, which has faced numerous production delays since its prototype debut in 2019.
Tesla initially projected the Cybertruck would be priced around $40,000 with a 500-mile range. However, these estimates have been revised several times over the years. The recent removal of the $61,000 model aligns with broader trends of increasing costs and evolving market strategies within the electric vehicle industry. Unlike earlier promises, the current pricing and range capabilities appear to be less favorable, raising questions about the company’s ability to meet initial consumer expectations.
Market Adjustments and Consumer Expectations
Tesla CEO Elon Musk had previously mentioned that the company received one million reservations for the Cybertruck, with many customers opting for the refundable $100 deposit. Musk’s vision included manufacturing 200,000 units annually, but the latest pricing adjustments suggest a complex interplay between production challenges and market demand. Some customers express disappointment as they hoped for more affordable options.
The first production candidate of the Cybertruck was completed in July 2023, marking a significant delay from the initial timeline projected by Tesla. Additionally, the trapezoidal design of the truck, inspired by the movie “Bladerunner,” has contributed to its unique market position. The dual-motor variant, now the cheapest available model, offers a 318-mile range and is slated for delivery as soon as this month. Meanwhile, the tri-motor variant with a 301-mile range will be available starting in October.
Industry Insights and Impacts
Guidehouse Insights analyst Sam Abuelsamid commented on the situation, indicating that the demand might be lower than Tesla’s previous estimates of one million trucks. He mentioned,
“They’re sitting on a lot of inventory of two-motor and three-motor trucks right now.”
This perspective aligns with the market’s mixed reviews on the Cybertruck’s pricing and features.
Deliveries of the Cybertruck began in November 2023, following years of postponements and a challenging production ramp-up. Musk cited supply chain shortages as a critical factor in the production delays. Despite these challenges, Tesla continues to push forward with its plans, albeit with adjusted expectations and strategies.
The evolving scenario with Tesla’s Cybertruck highlights the broader challenges faced in the electric vehicle market, where initial promises often clash with practical constraints and market realities. Prospective buyers and investors should closely monitor future developments as Tesla navigates these complexities.
