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Rising Prices of Tesla Gets Blamed on Raw Material Costs By Elon Musk

Another item to get added to the list of items that have their prices increased during the pandemic is Tesla.

According to the comparison of the Tesla website on the Wayback Machine Internet Archive, last week, the Tesla Model 3 price got raised to $39,990, which is $2,000 more than before for the base model.

Moreover, the Tesla Model Y SUV also got its price raised to $51,990, which is around $5,000 more than before.

A fan on Twitter questioned Elon Musk on why the prices are getting increased. To which Elon Musk replied that the increased prices are not in their control.

Musk Tweeted:

“Prices increasing due to major supply chain price pressure industry-wide…Raw materials especially.”

The price of new and used cars is at the highest record level all over the industry.

Prices of Tesla
Prices of Tesla

However, that is because of the high demand and the shortage of vehicles made for sale because of the plant being closed, causing the shortage of computer chips.

In April, investors got told by Musk that the computer chips being in a shortage was causing a huge problem.

For the first quarter, the more expensive models of Tesla, the Model S and Model X did not get built, because of the chips that they had got used for their Model 3 and Model Y.

It still has not continued the delivery of either of these cars. However, they do promise that the Model S will soon be available for delivery.

When it comes to raw materials, computer chips are not the only items in shortage and have gotten their prices increased.

A key material that gets used in EV batteries is Lithium, which also got doubled the trade market price.

Furthermore, another key material that gets used for batteries is cobalt and its price is even higher than it was earlier this year.

The exact price that Tesla is paying for such raw materials under their contract with suppliers is not exactly known.

The situation is similar for other materials that get used in making a car, like steel, aluminum, and copper.

The prices of such materials have also gotten seen to rise in public markets.

It has even got reported that tires are in shortage throughout the industry.

This year, the plan that Tesla has is to raise production by more than 50%.

Tesla is attempting to control the prices of its items wherever it can.

Recently, in the Model 3 and Model Y, Tesla removed the Lumbar support feature for the front passenger seat.

According to Elon Musk, the data collected by Tesla showed that this feature is not getting used as much. Therefore, it was not worth it to add the extra cost and weight.

The Tesla Model S and Model X SUV have not gotten their prices raised, and they are the most expensive cars that Tesla makes.

ThriveVergehttps://thriveverge.com
The founder and CEO of ThriveVerge, Thrive, and The Verge Revolution. In 2016, he launched Thriveverge, a leading behavior change technology, news, media, entertainment, and daily news company with the mission of changing the way we work and live by ending the collective delusion that burnout is the price we must pay for success.
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