Tiny SUV can facilitate improve margins for Tesla.


Tesla disclosed Model Y in March this year with a tag of $46,700 for the dual-motor all-wheel-drive version that has 280 miles (EPA local time.) of vary on one charge. The crossover shares nearly seventy fifth of its parts with its relative, Model 3, serving to Tesla to save lots of on production prices. in step with corporate executive Elon Musk, Model Y’s “high element overlap with Model 3” makes it easier to ramp.

During 2019’s second quarter earnings decision, Elon Musk aforesaid, “At Fremont, preparations for Model Y production have already begun. Since Model Y has high element overlap with Model three, it ought to be — we tend to expect it to be — heaps easier to ramp. It’s one thing on the order of 3 quarters of all the components [that] square measure common between Model three and Model Y. and that we expect the producing prices for Model Y, despite further content, to be close to an equivalent as Model three.”

Tesla has rigorously priced Model Y, slightly on top of Model three. With quite common fraction of the parts shared between the 2 models, its higher average asking price of Tesla’s new, tiny SUV can facilitate improve margins for Tesla. to it finish, it’s seemingly Model Y may persuade be additional profitable for Tesla than Model three. and therefore the edge is not solely regarding further profit, Model Y ought to conjointly relish many distinctive blessings over Model three.