Tesla has increased the prices of its popular Model Y electric vehicle in the US, attributing the move to rising demand and eligibility for the expanded federal EV tax credit.
The US Treasury department recently adjusted EV tax credit rules, which could qualify more vehicles, including the Model Y, for the credit.
The Long Range model now costs $54,990, while the Performance version is priced at $57,990, excluding shipping fees.
According to some reports, this is the second time Model Y Long Range's price has been increased in less than two weeks.
The Independent reports that Tesla recently launched a price cut of nearly 20% on some versions of the Model Y during January to boost sagging demand and to make more versions of the Model Y eligible for the $7,500 electric-vehicle tax credit in the Inflation Reduction Act.
Meanwhile, Reuters suggests that the recent price rise is due to the government raising the ceiling on the price of eligible EVs.
According to The Verge, the US Treasury Department updated the way it classifies vehicles that qualify for the $7,500 tax credit as part of the IRA, and this move enables more vehicles, including the Model Y, to benefit from the tax credit.
The moves came after the US Treasury Department updated the way it classifies vehicles that qualify for its $7,500 EV tax credit as part of the Inflation Reduction Act.
All three reports agree that the changes should allow more vehicles, including the Model Y, to qualify for the tax credit.
Before the rule change, certain models of the Model Y, alongside the Cadillac Lyriq, weren't eligible for the EV tax credit because their sticker prices exceeded the maximum $55,000 suggested retail price for sedans.
While The Verge reports that the price increase was announced hours after the Treasury Department adjustment, Reuters suggests that it was the second price increase for the Model Y Long Range over the past two weeks.
Overall, the reports agree that Tesla has increased the price of the Model Y in the US due to the expanded federal EV tax credit and rising demand for the popular electric vehicle.