Tesla Launches Cheaper Versions of Model 3, Model Y Days After EV Tax Credit Ends

The new standard Model 3 rear-wheel drive sedan starts at just under $37,000, making it the cheapest model in Tesla’s lineup.
Tesla Launches Cheaper Versions of Model 3, Model Y Days After EV Tax Credit Ends
Tesla vehicles line a parking area at the company's Fremont, Calif., factory on Aug. 5, 2025. Noah Berger/AP Photo
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A week after a substantial federal tax incentive for purchasing electric vehicles (EVs) expired, Tesla unveiled two more affordable vehicles at less than half the cost of its popular Model X and Model S.

Buyers rushing to capitalize on the $7,500 tax credit before it expired on Sept. 30 pushed EV sales to record highs in September at Tesla, General Motors, and Ford. It remains to be seen how sales of EVs will play out in the final quarter of the year versus traditional gas or hybrid-electric vehicles.

Rob Sabo
Rob Sabo
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Rob Sabo has worked as a business journalist for nearly two decades and covers a broad range of business topics for The Epoch Times.