Tesla Inc. TSLA launched the refreshed Model Y in the U.S. last week, with marked differences in how it launched the refreshed Model 3 roughly a year ago.
What Happened: Tesla launched the refreshed Model Y on its website as a new variant in addition to the existing older variants of the vehicle, merely weeks after it was launched in China.
This marks a significant difference from its Model 3 launch when the company took months to launch it in the U.S. Tesla launched the refreshed Model 3 in China in August 2023 and in the U.S. months later in January. The new Model 3 replaced the old Model 3 variants and was not listed alongside the older variants.
This backfired on the company as it took time to scale Model 3 deliveries. The company itself pinned the decline in delivery volumes in the first quarter of 2024 to the production ramp of the updated Model 3 at the company’s Fremont factory.
The new Model 3 was also listed with the same starting price as the older vehicle in the U.S. upon launch. However, with the refreshed Model Y, the long-range all-wheel drive variant is priced 25% higher than its predecessor.
Expert Weighs In: “I like Tesla’s new approach of selling a fully loaded version of the Model Y Juniper design refresh as the ‘Launch Series’ at a higher price, alongside the old Model Y version. This creates a smoother transition. It suggests that production of the new version is low for now and they want to continue selling the old version,” Tesla researcher Troy Teslike said in a post on social media platform X.
“When the Model 3 Highland was introduced, the switch was immediate, which upset some buyers who had just purchased a Model 3 days before,” Teslike added.
Why It Matters: Tesla reported global deliveries of 1.79 million vehicles in 2024, down from full-year deliveries of 1.81 million in 2023, marking the first decline in over a decade.
Tesla CEO Elon Musk said in October that he expects vehicle sales to grow by 20%-30% in 2025. The differences in the launch of the refreshed vehicle are possibly aimed at retaining the delivery growth expectation.
Tesla expects to start deliveries of the new Model Y in March.
In Tesla's last quarterly report, the company said that its plans for new vehicles, including more affordable ones, remain "on track" for the start of production in the first half of 2025.
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Photo courtesy: Tesla
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