Tesla Inc.’s long-promised $35,000 version of the Model 3 sedan is still nowhere to be found, but it’s inching closer to that price point.

The electric-car maker has started taking orders for a mid-range battery Model 3 that goes about 260 miles between charges for $45,000. That’s about $4,000 less than the starting price of the sedan that went on sale last year, excluding incentives or options.

While Tesla is making the Model 3 more accessible to some buyers, the starting price for sedans with the long-range battery is rising to $54,000. This iteration of the car boasts 310 miles of driving range, plus a faster top speed and zero-to-60 time. A cheaper rear-wheel version will no longer be available.


Chief Executive Elon Musk noted in a tweet that the mid-range Model 3 costs $35,000 after federal and state tax rebates in California, but the clock is ticking on buyers being able to get a big chunk of those savings.

Tesla buyers will no longer be able to get the full $7,500 federal tax credit after Dec. 31 because the company reached the 200,000 sales threshold in July. That incentive will be cut in half for the first six months of 2019, and then gets halved again for the following six months.

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Tesla also removed a $3000 option for a future “full self-driving” feature for all Tesla vehicles from its website Thursday.


Buyers have been given the option since October 2016, which Tesla promised would be available when the technology was ready and state laws allowed it. The technology would allow the car to drive itself for an entire journey, a radical advancement beyond Tesla’s Autopilot, which is the company’s brand name for adaptive cruise control and automatic lane changing. Autopilot still requires a driver’s full attention.

California regulations now permit driverless cars on road if the manufacturer complies with a long list of rules, but Tesla kept pushing introduction of the feature into the future. No auto manufacturer has yet deployed driverless cars beyond the testing phase.

Asked on Twitter about the end of the driverless option Thursday, Musk said it “was causing too much confusion,” and did not elaborate.

Tesla has yet to address the issue of refunds for those who’ve already paid their $3,000.


Musk, 47, first unveiled the Model 3 to great fanfare in March 2016, pledging that it would start at $35,000 before incentives. Within days, the company had more than a quarter of a million reservations. While he has yet to deliver on that sticker price 2½ years later, demand has been strong, with sales rivaling some of the top-selling passenger cars in the U.S. last quarter.

When Musk announced a performance version of the Model 3 in May that cost around $80,000, he said the company needed to reach higher levels of production and reduce costs. Shipping a $35,000 iteration of the sedan right away would “cause Tesla to lose money & die,” he tweeted.

That long-awaited price point may still be another few months away, Musk suggested in a post on Thursday describing the mid-range Model 3.

It’s a long range battery with fewer cells. Non-cell portion of the pack is disproportionately high, but we can get it done now instead of ~February — Elon Musk (@elonmusk) October 18, 2018