Tesla Gave This European Country a Whopping 80% Discount, but It's Not What It Seems

Tesla rocked the automotive industry with its recent pricing policy change. Customers from the U.S., Canada, and Europe who dreamed of buying an EV received the best news possible – overnight, the automaker’s entire lineup became considerably cheaper. However, this one country ended up benefitting from dizzying price cuts that turned out to be… A simple error fix.
Tesla Model 3 12 photos
Photo: Swedspeed on Reddit
Tesla Logo RenderTesla Model 3 InteriorTesla Model XTesla SuperchargerTesla Logo on a Wrapped CarTesla price cuts are a punch in the gut to all other players in the EV arenaTesla price cuts are a punch in the gut to all other players in the EV arenaTesla price cuts are a punch in the gut to all other players in the EV arenaTesla price cuts are a punch in the gut to all other players in the EV arenaTesla price cuts are a punch in the gut to all other players in the EV arenaTesla price cuts are a punch in the gut to all other players in the EV arena
But it is not as simple as it may look at first glance. Around a fortnight ago, Tesla slashed prices for its entire lineup. It wasn’t just a friendly discount. The Model S Plaid became $21,000 cheaper, while the very popular five-seater Model Y Long Range was brought to a price point that allowed it to be eligible for the new EV tax credit (aka the clean vehicle credit).

This was one unexpected solution, considering that the three-row Model Y Long Range qualified for the federal fiscal advantage thanks to its 1.1-inch increase in ride height over the five-seater model. Today, the Model Y Long Range is $500 more expensive and is the only vehicle in Tesla’s current portfolio that received a modest hike. Most likely, the automaker did this because it wanted people to order some Model 3s as well. Interest in Model Y was at an all-time high just a couple of days ago.

The whole discounting strategy was astonishing, considering that many customers who had bought a Tesla in December of 2022 or earlier were stupefied by the brand’s decision to slash all its vehicles’ prices. At the same time, it was a genius move. While competitors were still struggling with dealership hikes, Tesla showed everybody that it could give up on some profit margin on a random midweek afternoon. This surely triggered some alarm bells at Ford. Some of the Michigan-based manufacturer’s dealers tried to sell the F-150 Lightning for some insane prices that included unbelievable 'market adjustments.'

Tesla price cuts are a punch in the gut to all other players in the EV arena
Photo: Tesla
But the outcome of Tesla’s updated pricing policy was not only about an increase in demand while the economy is slowing and talks of a recession have kept progressively intensifying. It also had a ripple effect on the used car market.

Not stopping here

The value of some Model 3s and Model Ys, for example, dropped overnight by over $10,000 on platforms like CarMax. This also led to some very weird situations where a second-hand 2021 Model Y ended up costing more than a brand-new one on Carvana’s website.

And if you’re one of our frequent readers, then you’ll know that we anticipated this to the letter. Last summer, a couple of prospective customers, influencers, and some media outlets were enraged by Tesla’s price hikes. In a market where the demand was insanely high while the supply chain issues and parts shortages were kings, that was the normal thing to do. The automaker couldn’t afford to have an insane backlog that could’ve pushed deliveries of 2022 model-year units well beyond the middle of the current year.

So, we told you that the price cuts will eventually come. If you are among those who waited… Well, congrats! You might feel a lot better about yourself, especially as you discover that the average price of a new Tesla sold in the last three months of 2022 was $52,573.

Tesla Model X
Photo: Jorgen Hendriksen on Unsplash
Before adding $500 to the price of the Model Y Long Range in the U.S., the automaker adjusted the costs of its cars in Europe by nearly 1% to the upside. It was a slight increase across the board for those living over the pond. There wasn’t any good explanation for this adjustment, so we refrained from speculating.

But what’s up with the 80% discount?

When the EV maker applied this small hike in the Eastern European country of Romania, someone working behind the counter managed to raise prices to unbelievable levels. We compared the new values with what other high-end and very exclusive manufacturers charged for their models. We discovered that a base-spec Tesla Model 3 RWD was as expensive as a Lamborghini Huracan EVO RWD Spyder. That’s a convertible with a V10 in the rear.

To put things better into perspective, a fully loaded Tesla Model X Plaid ended up costing more than a new Rolls-Royce Phantom. The EV maker’s SUV might be plenty fast, but it’s no equal to the British ultra-luxury marque that makes great use of silky smooth V12 powertrains and is on track to launch its first battery-electric vehicle – the Spectre.

That didn’t make any sense, so we investigated and found out that the error was related to conversion rates. Or non-conversion rates for the matter. Essentially, Tesla published the prices in the country’s local currency instead of euros. It added the wrong symbol and that created a lot of confusion.

Tesla price cuts are a punch in the gut to all other players in the EV arena
Photo: Tesla
Even though it is a small market for Tesla, people living in Romania showed an interest in EVs. Since the price cuts were made available to them as well, some may have experienced the fear of missing out. The country’s government offers a €10,000 ($10,907) rebate, which essentially drops the base price of an all-wheel-drive Model Y Long Range to €43,990 ($47,977) with the value-added tax (VAT) included. But accessing the automaker’s online platform and seeing an eye-watering price of €267,410 ($291,624) left many wondering.

Fortunately, Tesla corrected the pricing error by applying a discount of 79.8% across the board and now, the numbers are similar to what other Europeans are seeing on the carmaker’s online configurator.

At the time of writing, the company charges Romanians:
  • €44,990 ($49,026) for a Model 3 RWD;
  • €52,990 ($57,743) for a Model 3 Long Range;
  • €59,990 ($65,371) for a Model 3 Performance;
  • €46,990 ($51,205) for a Model Y RWD;
  • €53,990 ($58,830) for a Model Y Long Range;
  • €63,990 ($69,726) for a Model Y Performance;
  • €112,970 ($123,097) for a Model S Dual Motor;
  • €137,970 ($150,339) for a Model S Plaid;
  • €120,970 ($131,814) for a Model X Dual Motor;
  • €140,970 ($153,608) for a Model X Plaid.

Finally, it is now clear that it was just an unfortunate mishap. But it did provide the local market with some new reasons to talk about the EV maker’s vehicles, so that’s another free advertising win for Tesla’s inexistent marketing department.
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About the author: Florin Amariei
Florin Amariei profile photo

Car shows on TV and his father's Fiat Tempra may have been Florin's early influences, but nowadays he favors different things, like the power of an F-150 Raptor. He'll never be able to ignore the shape of a Ferrari though, especially a yellow one.
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