Tesla Hikes Model X Prices In U.S. And Canada: Drops New Incentives Into Gear

Tesla has announced substantial price increases for its Model X electric vehicle (EV), while simultaneously reintroducing a previously discontinued incentive program. The price adjustments, which took effect recently, represent a complex balancing act between maintaining profitability and offering customer incentives in an increasingly competitive EV market.

Tesla Increases Model X Prices

The most notable change is a $5,000 price increase in the United States (U.S.), bringing the Model X Long Range version to $84,990 and the Plaid variant to $99,990. This price adjustment carries particular significance as it pushes the Long Range model above the $80,000 threshold for federal EV tax credits, meaning U.S. buyers can no longer access the $7,500 incentive for this model.

The pricing changes extend beyond the U.S. market, with Canadian customers experiencing even more substantial increases. Tesla has implemented two consecutive price hikes in Canada within a week, totaling a CAD 11,000 increase. The Model X All-Wheel Drive now starts at CAD 121,990, while the Plaid version reaches CAD 142,990.

“Free Supercharging” Returns

To offset these price increases, Tesla has revived its “free Supercharging for life” program, an incentive that CEO Elon Musk previously declared unsustainable and unlikely to return. However, the revived program comes with modified terms. Unlike the original offering, where the benefit was tied to the vehicle, the new program links free Supercharging to the owner’s Tesla account and excludes vehicles used for commercial purposes such as taxi services, ridesharing, or deliveries.

New Incentives Introduced

The company is also introducing additional incentives, including a $1,000 discount with referral codes and a free option for customers who purchase the Full Self-Driving package. These moves suggest Tesla is working to maintain demand for its premium SUV despite the higher price point and loss of federal tax credits.

In Canada, Tesla has introduced separate incentives for its Model 3 line, offering an attractive 0.99% APR financing option for orders placed by March 7 with delivery by March 31. This financing rate stands out in today’s market, where standard auto loan rates typically exceed 5%.

Shift in Tesla’s Strategy

These pricing and incentive changes come at a time when Tesla reports progress in reducing vehicle production costs, with the company noting that average materials and labor costs for manufacturing reached their lowest point in Q4 due to declining raw material prices. However, the company has not explicitly stated the reasoning behind the recent price increases.

Read More: Tesla Cuts Lease Prices On Model 3 And Cybertruck To Boost Market Edge

The reintroduction of previously discontinued incentives, particularly the free Supercharging program, represents a notable shift in Tesla’s approach to customer incentives and suggests an evolving strategy in response to market conditions and competition in the premium EV segment.

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