Tesla falls after issuing a fresh round of price cuts ahead of reporting earnings results
- Tesla shares fell Wednesday after the company cut prices for the sixth time this year.
- Among the cuts, the Model Y All-Wheel Drive was reduced by $3,000 to $46,990.
Tesla shares fell Wednesday as the company cut prices on some of its electric vehicles, making the sixth round of reductions this year just before it released its latest quarterly earnings report.
Tesla cut prices on its Model 3 and Model Y in the US, working to entice more buyers in an increasingly competitive market. Among the moves, pricing on the company's website showed a $3,000 cut in the Model Y All-Wheel Drive to $46,990.
Shares of Tesla fell 2.9% in premarket trade, but had pared that loss to less than 1% by around midday Wednesday.
The Model Y Long Range model was reduced to $49,990 from $52,990 and the Performance model went to $53,990 from $56,990. Tesla's Model 3 Standard Range Rear-Wheel Drive now has a price tag below $40,000 – at $39,990 versus $41,990.
The federal tax incentive on the Standard Range RWD was cut to $3,750 under new guidance this week from the US Treasury Department, but other Tesla models were still eligible for the full $7,500 credit.
Tesla investors late Wednesday will watch the company's margins following this year's price cuts. The company is expected to post revenue of $23.73 billion for the first quarter, according to a FactSet poll of analysts. That would represent a 26% increase from the same period a year ago but a decline from $24.32 billion in the fourth quarter of 2022.
The FactSet per-share earnings projection is $0.85 a share compared with $1.07 a share a year earlier.
The stock in 2023 has been recovering from last year's brutal 65% decline, making it among the worst-performing shares on the S&P 500 in 2022.