We’ve all been waiting eagerly to hear more about the mythical sub-$30k EV Tesla has supposedly been working on, but it turns out that for Californians it’s kinda already here.
Although en entry-level, single-motor, rear-wheel drive Tesla Model 3 has a list price of $40,240, people living in California can effectively cut that bill by over 35 percent by taking advantage of available state and federal incentives. Those schemes, plus Tesla’s recent round of price cuts, potentially brings the cost of a Model 3 to just $25,240, which Reuters pointed out is less than the price of a Toyota Camry that starts at $26,320.
Though some versions of the Model 3 were previously only available with half of the full $7,500 federal tax credits due to new rules about the geographical source of an EV’s battery and its components, Tesla was fast to react to the legislation and announced this week that every Model 3 once again qualifies for the full credit.
Related: 2025 Tesla Model 3 ‘Project Highland’ Filmed Testing
Though Tesla hasn’t confirmed what technical changes it has introduced to make all three Model 3s eligible for the full $7,500 tax credit allowance, analysts Reuters spoke to suggested the automaker might have swapped the CATL battery in the base car for an alternative from Panasonic or LG. While the unit cost of those batteries would be higher it would be more than offset by granting the car eligibility for maximum tax credits.
“It is highly likely it is Panasonic but there may be some concerns around cell availability if they need to supply enough for all U.S. Model 3s,” Benchmark Mineral Intelligence (BMI) analyst Caspar Rawles told Reuters.
The prospect of a $25k Model 3 is sure to entice plenty of prospective Californian EV buyers to a Tesla showroom, but with a heavily revised version of the now six-year-old sedan on the horizon we have a feeling others might be tempted to hang on and see what Tesla brings to the table in the second half of 2023.
