Tesla Model 3 and Y back under $40,000: stripped-back trims slash prices

Show summary Hide summary

• Pricing details: under $40,000 but not the $35K goal
• Federal incentives and the real cost to buyers
• Range, drive layout and what’s missing from the Standard trims
• How the lineup shifts and a nod to the Performance Model

Tesla has launched two pared-down versions of its best-selling electric vehicles, aiming to reach more buyers with lower sticker prices. The new Standard Model 3 sedan and Standard Model Y SUV arrive with notable trims to cost, range estimates and equipment choices that change how shoppers will compare options across the lineup.

Pricing details: under $40,000 but not the $35K goal

Tesla lists the Standard Model 3 at $36,990 and the Standard Model Y at $39,990. Both prices put the vehicles below the $40,000 mark that many buyers watch.

The company had previously flirted with a $35,000 Model 3 price point. These new figures stop short of that level but clearly target a broader market segment.

Federal incentives and the real cost to buyers

The U.S. federal EV tax credit of $7,500 expired on September 30. That change affects effective purchase prices immediately.

• Without the federal credit, the Standard trims cost about $2,000 more than the model Tesla labeled “Premium” would have last week.
• Local and state incentives may still apply, but the federal incentive lapse raises the upfront cost for many buyers.

Range, drive layout and what’s missing from the Standard trims

Both Standard models share an EPA estimated driving range of 321 miles on a full charge. But Tesla removed several options to reach the lower price.

• Drive: Available only with rear-wheel drive.
• Driver-assist: No Autopilot or Autosteer included.
• Interior features: Only the first-row seats have heating.
• Entertainment and convenience: No second-row touchscreen and no AM/FM radio.

These changes trim near-term production complexity and reduce cost, but also narrow the feature set for buyers who expect full Tesla amenities.

How the lineup shifts and a nod to the Performance Model

While the Standard trims are a move toward affordability, Tesla continues to update higher-tier variants. The Model Y Performance received an update recently, keeping the top-end options fresh for buyers who want more power and features.