Tesla Launches Model Y and Model 3 with Lower Prices, a Strategy to Tackle the EV Market?

Liputan6.com, Jakarta Tesla officially announced the launch of a more affordable 'Standard' variant of the Model Y and Model 3.

This significant announcement, made on October 7, 2025 comes in response to the expiration of the $7,500 federal electric vehicle tax credit in the United States.

During a call with investors in April, CFO Vaibhav Taneja again claimed a cheaper model was imminent and would be widely available in the fourth quarter of this year.

“We started the production of the lower cost model as planned in the first half of 2025,” he said.

“However, given our focus on building and delivering as many vehicles as possible before the EV credit expires and the additional complexity of ramping a new product, the ramp will happen (in the fourth) quarter, slower than initially expected.”

Meet Model Y Standard & Model 3 Standard – our most affordable vehiclesUltra-low cost of ownership, engineered for safety & comes with the best Tesla features you love– 321 mi of range– Extreme efficiency that takes you farther + saves you $$– Minimal maintenance– Can… pic.twitter.com/2cMQ5NW6Yf

— Tesla (@Tesla) October 7, 2025

The introduction of the 'Standard' variant is part of Tesla's broader strategy to address existing market challenges.

Its primary goal is to offset the impact of the loss of the $7,500 federal electric vehicle tax credit in the United States, which effectively increased the selling price of cars for consumers.

Other automakers are also expected to release lower-priced versions of their EV offerings for American buyers.

Last week, Hyundai announced an EV priced significantly lower than its predecessor by $9,800.

The Tesla Model Y Standard now comes with a more attractive starting price, starting at $37,990.

Other sources also cite a starting price of $39,990, and with destination and reservation fees, the starting price could reach $41,630.

This is about $5,000 cheaper than the previous, most affordable version of the Model Y.

The driving range is reduced to 321 miles from 357 miles, and the interior uses cloth instead of microsuede.

This model also lacks the panoramic glass roof and has fewer audio speakers, with 7 speakers compared to 15 on the higher-end model.

Other feature cuts include the omission of a second-row touchscreen, manual steering wheel adjustment, and the removal of seat ventilation, rear heating, power-folding mirrors, and headlights.

Exterior-wise, the Model Y Standard features a new bumper design, different lighting, and fewer premium touches.

However, the 0-60 mph acceleration time remains impressive at 6.8 seconds.

The Tesla Model 3 Standard variant was also introduced with a lower starting price, starting at $34,990.

Some reports indicate the starting price could be as high as $36,990, and with destination and reservation fees, the starting price could be as high as $38,630.

This is about $5,500 less than the existing Premium RWD version.

Like the Model Y Standard, the Model 3 Standard also has several feature adjustments to keep costs down.

The driving range is reduced compared to the previous model, and the audio system has fewer speakers (7 speakers instead of 15), and the subwoofer has been removed.

The autonomous driving feature in the driver assistance system has also been removed.

The interior of the Model 3 Standard features textile seats, with a vegan leather option available.

Despite the feature reductions, the 0-60 mph acceleration time remains strong at 6.8 seconds.

Estimated delivery dates for the Model Y Standard and Model 3 Standard are expected to begin between December 2025 and January 2026, giving buyers time to plan their electric vehicle purchases.