The US price of Tesla's Model Y and Model 3 has been reduced again. According to its website, the price of the standard Model 3 sedan is reduced by $1,250, while the Model Y long-life version is $2,000 cheaper.

So far this year, the price of the standard Model 3 has dropped by about 17%, while the price of the long-life Model Y has dropped by more than 26%. Tesla's continued price cuts have intensified the price war in the electric car market and put more cost pressure on the three U.S. automakers in Detroit, which are still in the midst of a strike.
However, the flip side of the price cut also reflects Tesla's potential difficulties in demand, which is also worried by many investors.
Gary Black, managing partner of the Future Fund, said there was no way for Tesla to sugarcoat the situation. He predicted that Tesla would soon need to revise its demand forecast for 2024.
The bears get complacent
Gordon Johnson of GLJ Research, a longtime Tesla bear, said the price cut proves that Tesla's massive delivery delays in the third quarter were not due to any key production line upgrades, but to weak demand.
Tesla said Monday that its vehicle deliveries in the third quarter of 2023 fell short of analysts' expectations due to planned summer shutdowns caused by factory upgrades, falling 6.7 percent from 466,000 in the second quarter to 435,000 in the third quarter.
This statement is obviously somewhat at odds with the move to cut prices, and instead becomes evidence that the bears are singing about Tesla's demand problems.
The price cuts this year have effectively erased all of Tesla's price increases over the past two years, and the price of the long-life Model Y, Tesla's star product, is now $48,990, down from $49,990 in 2021.
Profit is not an issue
Weak demand may cause Tesla to repeatedly use low prices to attract customers, but Tesla CEO Elon Musk believes that as long as the current volume can run, thin profits are not a problem.
During his first-quarter earnings call in April, Musk said that sales came before profits. He said Tesla would deliver a lot of cars at a lower profit and recoup those profits when it perfected its self-driving system in the future.
Tesla is scheduled to report its third-quarter earnings on Oct. 18. According to analysts surveyed by Visible Alpha, Tesla's automotive gross margin for the third quarter is expected to be 19.1 percent, a sharp drop from the record profit margin of more than 32 percent in the first quarter of last year.