Tesla Model 3 has offered a more affordable entry-level version in Mexico, indicating a strategic shift in the company’s price strategy. Tesla’s goal in deleting some luxury features is to make its popular electric sedan more accessible to a broader audience. This move underlines Tesla’s continuous efforts to be competitive in an increasingly crowded EV market, particularly against aggressively priced models from new entrants.
Pricing Challenges in a Competitive Market
However, remaining competitive in pricing is difficult. New players, mainly from China, are aggressively selling their electric cars. To be competitive, Tesla has undertaken strategic changes. One significant example is a new entry-level Model 3 launch in Mexico. This variant foregoes several typical features to provide a lower price.
Tesla’s new Model 3 in Mexico is a more economical option. Unlike earlier models, it lacks several premium features. For example, the upholstery is now gray rather than black or white leatherette. The seats are no longer heated or ventilated, and the steering wheel has no heating feature. Tesla has deleted amenities like the back entertainment screen and RGB ambient lighting. The car still features acoustic glazing, but just on the front windows.
Tesla Model 3: Comparing Equipment Across Markets
In some markets, such as France, the Model 3 Propulsion includes additional capabilities. For example, France has a 9-speaker audio system, unlike 17 speakers in the Long Range version. However, you cannot order a Model 3 Propulsion with outdated equipment in Mexico. The only option to get those features back is to upgrade to the more expensive Model 3 Long Range.
Despite the limited features, this new entry-level Model 3 could entice purchasers. Many buyers chose Tesla based on its performance and dependability, not only its features. The car still has a respectable range and strong recharge capabilities. Some argue that the cheaper price justifies the trade-off in features.
Potential Expansion of Entry-Level Models
There is no sign that Tesla will introduce this entry-level Model 3 to Europe. But if it does, it may appeal to a larger audience. In France, the Model 3 Propulsion costs €41,490, which some consider prohibitively pricey. A less expensive, stripped-down version may attract more purchasers. Furthermore, Tesla may explore releasing an entry-level version of the future restyled Model Y in Europe. This move may qualify for ecological bonuses in France, making it even more appealing.
The Evolution of Tesla’s Feature Set
Tesla has long intended to make electric vehicles cheap. The company’s mission has never included luxury. However, Tesla’s costs remained high for many years because of increased demand beyond 2020. As demand declined, Tesla had to reconsider its price strategy.
Even though Tesla is not a premium brand, its vehicles are often equipped with various features. These are frequently standard in Tesla automobiles but optional in competitor models. However, some detractors believe Tesla lacks features commonly found in expensive vehicles. For example, ambient lighting was recently incorporated into the updated Model 3. Furthermore, Tesla still does not offer massage seats, which some find frustrating.
Even the lowest model of the new, redesigned Model 3 has numerous comfort elements. However, some clients may find these features unneeded. Heated and ventilated seats, ambient lighting, and a rear infotainment screen are all optional extras. By removing these, Tesla could reduce the price, which many Mexican buyers appreciated.
The Mexican Tesla Model 3: A Closer Look
The Mexican version of the Model 3 is comparable to the US version but lacks a few features. Instead of vegan leather, the seats are covered in textile fabric, eliminating heating and cooling requirements. A heated steering wheel is unneeded in a warm climate like Mexico, so it has been eliminated. Tesla also reduced costs by employing acoustic glass just on the front windows.
Interestingly, the stripped-down Model 3 in Mexico costs more than the US version while having fewer luxuries—the Model 3 RWD costs 749,000 pesos in Mexico, or approximately $40,211. In the United States, the same model is $38,990 with all features included. However, the price difference does not apply to the more expensive trims. For example, the Model 3 Long Range AWD is priced identically in both markets.
Tesla’s marketing strategy is constantly evolving. The release of a stripped-down Model 3 in Mexico demonstrates Tesla’s willingness to change and remain competitive. Although some features have been deleted, the vehicle still provides excellent performance and value. As Tesla navigates a shifting market, it will be interesting to see how its pricing and features develop in different regions.
