Tesla, Inc. (NASDAQ: TSLA) shares witnessed a remarkable surge Wednesday following the launch of a budget-friendly variant of its popular Model Y electric SUV.
Tesla reintroduced its Model Y RWD, a rear-wheel drive SUV, with an enticing price tag of $43,990, making it $3,500 cheaper than its previously lowest-priced all-wheel-drive (AWD) version. Tesla expects this new model to hit the market later this month or early next.
Elon Musk’s company had previously discontinued its rear-wheel drive Model Y in favor of the longer-range all-wheel drive variant. However, this strategic reentry into the lower-priced segment is set to make waves.
The Model Y RWD would cover 260 miles on a single charge, thanks to its innovative lithium-iron-phosphate batteries, known for their superior longevity over nickel-manganese-cobalt batteries. Moreover, buyers of the Model Y RWD will also be eligible for the $7,500 U.S. EV tax credit.
The development comes after Tesla (NASDAQ: TSLA) released third-quarter delivery numbers, which fell short of analyst expectations.
On Monday, Tesla revealed that it delivered a little over 435,000 vehicles during the third quarter, marking a surprising shortfall of over 20,000 units compared to Wall Street estimates. This represents a 6% decline from its second-quarter deliveries. The company attributed this temporary setback to scheduled downtime in its manufacturing plants to implement essential updates.
Tesla stock surged over 5% to close at $261.16 on Wednesday. Tesla’s shares have more than doubled in value this year.