Published: Sat, March 02, 2019
Money | By Arnold Ball

Tesla finally releases its "affordable" Model 3

Tesla finally releases its

All of these decisions are a result of CEO Elon Musk's desire to reduce Tesla's spending and increase profitability.

Tesla says it is launching the long-promised $35,000 version of its Model 3-and shifting all of its sales online to help lower costs. Over the next few months, Tesla will wind down "many" of its stores, while investing in its service system, it said.

Musk said the standard Model 3 was "an incredible car", citing a top speed of 130mph and a 0-60mph time of 5.6s.

Less likely to be pleased is the group of new Tesla buyers who have just seen pricing for Model 3, Model S, and Model X cars drop considerably.

In addition to the Model 3 news, Tesla said sales going forward would be online only, with the company saying that "a test drive prior to purchase isn't needed" because of a 7-day, 1,000-mile return policy.

Musk also backed off of earlier guidance that the company would be profitable in all future quarters.

To get "full self-driving", buyers will need to stump up $5,000 extra, which enables "automatic driving from highway on-ramp to off-ramp including interchanges and overtaking slower cars", auto-parking, and "summon", the feature that makes a parked vehicle find the owner.

But in order to sell the vehicle at a lower price, the company will close the majority of their stores and shift sales worldwide to online only.

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Trading of Tesla shares was halted around 4:58 p.m. ET ahead of the news.

Gairns said: "Tesla's announcement that they are closing most of their retail outlets will force the whole industry to accelerate the move to online vehicle sales and is yet another example of where the industry is following behind other sectors such as finance, retail and electronics".

Elon Musk has been teasing an important Tesla announcement this week and now we finally have the details. It said that customers will be able to purchase a auto via a phone in about one minute and that they'll be able to return them for a full refund after driving them for up to seven days and 1,000 miles.

In its annual report released last month, Tesla said it "had established and continue to grow a global network of stores..."

Until now, Tesla has concentrated on selling Model 3s with long-range batteries and more equipment, meaning the average price paid was around $50,000 (£38,000). This model costs $37,000.

The Model 3 electric vehicle has a range of 220 miles, a top speed of 130 mph and 0-60mph acceleration of 5.6 seconds.

Although Musk corrected his mistake, the United States regulators slammed the Tesla CEO because he "once again published inaccurate and material information about Tesla to his over 24 million Twitter followers".

Tesla is now offering two software packages; regular autopilot, at a cost of $3,000 (£2,270) which will allow for automatic steering on highways or full self-driving ($5,000) which takes over more functions, such as changing lanes, navigating junctions and taking exits.

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