Merely a couple of weeks ago Tesla announced that it was making a significant change to the way it sells vehicles. The company was to shut down almost all of its stores and move sales online entirely. It was described as an effort to cut down costs as the company tries to make its electric cars cheaper. Tesla has changed its mind now, though.
Tesla had 398 retail stores as of Q4 and the company was initially planning to close nearly all of them. It won’t be doing that now. Tesla is going to keep an expanded number of its retail stores open with only half of the showrooms being closed.
To accommodate the expense of keeping a lot of its existing stores open, Tesla has decided to raise prices by 3 percent. “Potential Tesla owners will have a week to place their order before prices rise, so current prices are valid until March 18th,” the company said.
It also pointed out that this price hike does not impact the cheapest Model 3 variant which costs $35,000. The price hike is applicable to the more expensive variants of the Model 3 as well as the Model S and Model X.
Tesla had actually cut the prices of these vehicles by six percent when it had announced the initial closure of almost all stores so this 3 percent hike essentially halves the earlier discount. Tesla is moving on with its strategy to sell cars online primarily.
The stores that will remain open will serve as showrooms with “smaller Tesla crews.” The employees will actually guide customers on how to purchase a Tesla online. Some stores will have a small number of cars in the inventory for customers who wish to walk out with a new Tesla that very day.
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