{"id":73721,"date":"2023-04-20T12:37:24","date_gmt":"2023-04-20T02:07:24","guid":{"rendered":"https:\/\/www.solarquotes.com.au\/blog\/?p=73721"},"modified":"2023-04-21T01:00:29","modified_gmt":"2023-04-20T14:30:29","slug":"model3-australia-cheaper-than-usa","status":"publish","type":"post","link":"https:\/\/www.solarquotes.com.au\/blog\/model3-australia-cheaper-than-usa\/","title":{"rendered":"Australians Pay $4,000 Less Than Americans For Tesla Model 3 RWD"},"content":{"rendered":"<div id=\"attachment_73771\" style=\"width: 1210px\" class=\"wp-caption aligncenter\"><img decoding=\"async\" aria-describedby=\"caption-attachment-73771\" class=\"size-full wp-image-73771\" src=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/australian-model3-outback.jpg\" alt=\"An AI generated Model3 in the Aussie Outback\" width=\"1200\" height=\"628\" srcset=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/australian-model3-outback.jpg 1200w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/australian-model3-outback-300x157.jpg 300w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/australian-model3-outback-1024x536.jpg 1024w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/australian-model3-outback-768x402.jpg 768w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><p id=\"caption-attachment-73771\" class=\"wp-caption-text\">Image Credit: MidJourney\/Finn<\/p><\/div>\r\n<p>In good news for Americans: Tesla cut electric car prices yesterday. In good news for Australians, we&#8217;re still paying less than Americans for the cheapest Model 3 (excluding government charges or incentives).<\/p>\r\n<p><!--more-->Here are yesterday&#8217;s US price reductions:<\/p>\r\n<ul>\r\n<li>Model Y Long Range cut 5.6% to USD49,990\u00a0<\/li>\r\n<li>Model Y Performance cut 5.2% to USD53,990\u00a0<\/li>\r\n<li>Model 3 Rear Wheel Drive cut 4.7% to USD39,990<\/li>\r\n<\/ul>\r\n<p>I&#8217;m hoping we&#8217;ll see price cuts here in Australia, but this may be optimistic, as we&#8217;ve had two price cuts already this year, dropping the Model 3 RWD NSW driveaway price to AU$66,040 from a high of AU$71,807 in January 2021.<\/p>\r\n<p>An 8% decrease in the Australian on-road cost over two and a quarter years isn&#8217;t bad, especially since inflation was 9% over this period. That&#8217;s a 16% decrease in real terms.<\/p>\r\n<p>After all the latest price cuts, we&#8217;re paying around $4,000 less than Americans for the cheapest Model 3:<\/p>\r\n<ul>\r\n<li>Australian price before on-road costs: AU$60,900<\/li>\r\n<li>Australian price before GST: AU$55,363\u00a0<\/li>\r\n<li>Americans are paying: USD39,990 = AU$59,529<\/li>\r\n<li>Difference = AU$4,166<\/li>\r\n<\/ul>\r\n<h2>Why Price Cuts?<\/h2>\r\n<p>There are three reasons why Tesla&#8217;s cutting prices, and I&#8217;ll call them the good news, bad news, and real news.<\/p>\r\n<h2>Good News &#8212; Falling Commodity Prices<\/h2>\r\n<p>Lithium is vital for producing most <a href=\"https:\/\/www.solarquotes.com.au\/electric-vehicles\/\">Electric Vehicles<\/a>&#8216; battery packs, and its price is now less than one-third of its peak price in November last year:<\/p>\r\n<div id=\"attachment_73742\" style=\"width: 951px\" class=\"wp-caption aligncenter\"><img decoding=\"async\" aria-describedby=\"caption-attachment-73742\" class=\"size-full wp-image-73742\" src=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/teslaev.png\" alt=\"Lithium price graph\" width=\"941\" height=\"654\" srcset=\"https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/teslaev.png 941w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/teslaev-300x209.png 300w, https:\/\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/04\/teslaev-768x534.png 768w\" sizes=\"(max-width: 941px) 100vw, 941px\" \/><p id=\"caption-attachment-73742\" class=\"wp-caption-text\">The figures on the right are US dollars.\u00a0 Note this is the price for lithium carbonate and not pure lithium metal.\u00a0 Lithium carbonate is 18.7% lithium by weight.\u00a0 That&#8217;s actually a lot because lithium is really light.<\/p><\/div>\r\n<p>This may be why Tesla recently <a href=\"https:\/\/www.solarquotes.com.au\/blog\/powerwall-price-drop-april-mb2895\/\">cut the cost of its Powerwall 2 home battery<\/a> for the second time this year.\u00a0 Other commodities used in EV manufacture have also fallen.\u00a0 Steel and aluminium are down by a third from around a year ago.\u00a0 Copper is only down 17%, but that&#8217;s copper for you &#8212; in big demand.\u00a0 Every solar panel, wind turbine, and EV wants some. \u00a0<\/p>\r\n<p>Lower raw material prices reduce the cost of making EVs but have the unavoidable downside of reducing the amount of money received by suppliers.\u00a0 This includes Australian producers of lithium, steel, aluminium, and copper.\u00a0<\/p>\r\n<h2>Bad News &#8212; Global Economic Slowdown<\/h2>\r\n<p>Falling commodity prices reduce the cost of making EVs, but they&#8217;re declining because the world economy is cooling off.\u00a0 We could have a mild slowdown or a full-blown recession.\u00a0 Either way, people are buying fewer vehicles, and car manufacturers are lowering prices in response.<\/p>\r\n<h2>Real News &#8212; Companies Like Money<\/h2>\r\n<p>Both commodities and global economics affect EV prices, but the real reason Tesla has dropped theirs is because they like money.\u00a0 Companies act to maximize the amount of money they make or, failing that, minimize how much they lose.\u00a0 All companies do this &#8212; or at least all the ones that don&#8217;t go bankrupt.\u00a0 It&#8217;s just the good ones will do it ethically.<\/p>\r\n<p>Due to decreasing commodity prices, increasing competition from other EV manufacturers, and a worsening world economy, Tesla had no choice other than cut prices.\u00a0 If they didn&#8217;t, they&#8217;d end up with unsold stock.\u00a0 That would hurt their bottom line, and keeping that line unharmed is what companies are all about.\u00a0<\/p>\r\n<p>Tesla is helping save the planet by making EVs that enable us to transition away from oil.\u00a0 But if their goal was only to make as much money as possible, their actions would be indistinguishable from what they&#8217;re doing now.\u00a0 If you want to predict what Tesla will do, just work out what will make its billionaire edgelord CEO the most money, and you&#8217;ll probably be right.<sup class='endnote'><a href='https:\/\/www.solarquotes.com.au\/blog\/model3-australia-cheaper-than-usa\/#en-73721-1' id='enref-73721-1' onclick='return hhEndnotes_show(73721)'>1<\/a><\/sup><\/p>\r\n<h2>Current Aussie Prices<\/h2>\r\n<p>Here&#8217;s what Tesla&#8217;s Australian site said you&#8217;ll have to pay for their EVs at 8:00 am this morning.\u00a0 This is the base price without any extra bells or whistles or whistling bells.\u00a0 It does include GST and, in two cases, some luxury car tax.\u00a0 I&#8217;ve also included the on-road cost in our most populous state, NSW.\u00a0 The actual on-road amount will vary by state or territory:<\/p>\r\n<ul>\r\n<li>Model S:\u00a0 Price not given, but the site still wanted me to pay $350 to order one.\u00a0 I passed on this.<\/li>\r\n<li>Model Y Rear Wheel Drive $68,900\u00a0 ($74,360 NSW on-road)<\/li>\r\n<li>Model Y Long Range $81,900\u00a0 ($87,880 NSW on-road)<\/li>\r\n<li>Model Y Performance $94,900\u00a0 ($99,579 NSW on-road)<\/li>\r\n<li>Model 3 Rear Wheel Drive $60,900 ($63,801 NSW on-road)<\/li>\r\n<li>Model 3 Long Range $73,900 ($76,801 NSW on-road)<\/li>\r\n<li>Model 3 Performance $86,900\u00a0 ($94,531 NSW on-road)<\/li>\r\n<\/ul>\r\n<h2>Fringe Benefits Tax Exemption<\/h2>\r\n<p>Before buying an EV, you should consider using the Fringe Benefits Tax Exemption to pay for it through salary sacrifice.\u00a0 This is a possibility if you&#8217;re employed or own your own business.\u00a0 This reduces your taxable income and effectively reduces the cost of buying a new EV.\u00a0 If you&#8217;re in the 32.5% tax bracket, you may pay around 32.5% less.\u00a0 It can only be done for new EVs that cost less than the <a href=\"https:\/\/www.ato.gov.au\/rates\/luxury-car-tax-rate-and-thresholds\/\">luxury car tax threshold<\/a>.\u00a0 At the moment, this is $84,916 for EVs, and it may increase in the future.\u00a0 The four Tesla EVs currently under this limit are&#8230;<\/p>\r\n<ul>\r\n<li>Model Y Rear Wheel Drive<\/li>\r\n<li>Model Y Long Range<\/li>\r\n<li>Model 3 Rear Wheel Drive<\/li>\r\n<li>Model 3 Long Range<\/li>\r\n<\/ul>\r\n<p>Note that buying extra options for these vehicles can push them above the threshold.\u00a0 The details of the Fringe Benefits Tax Exemption are way too complex for me to go into now &#8212; especially since I don&#8217;t understand them &#8212; but I recommend looking into it if it may be an option.<\/p>\r\n<h2>US\/Oz Price Differences<\/h2>\r\n<p>If I remove GST from the Australian prices &#8212; and in one case luxury car tax &#8212; and compare them to the now reduced prices of the four identically named models available in the US, then it reveals the following variation in prices between countries:<\/p>\r\n<ul>\r\n<li>Model Y Long Range:\u00a0 More or less the same price<\/li>\r\n<li>Model Y Performance: \u00a0 ~$3,000 more expensive in Australia<\/li>\r\n<li>Model 3 Rear Wheel Drive: ~$4,000 cheaper in Australia\u00a0\u00a0\u00a0\u00a0\u00a0<\/li>\r\n<li>Model 3 Performance:\u00a0 More or less the same price<\/li>\r\n<\/ul>\r\n<p>This means Australians are already paying considerably less for a Model 3 Rear Wheel Drive than Americans.\u00a0 Thanks, Elon, that&#8217;s appreciated!\u00a0 Unfortunately, it does mean we&#8217;re less likely to see a further fall in its price.\u00a0 But it looks like there is room for the Model Y Performance to come down, as it costs nearly $3,000 more here. \u00a0\u00a0<\/p>\r\n<p>If the Australian dollar grows stronger, it will increase the odds of further EV price cuts.\u00a0 Unfortunately, it could grow weaker and push up prices.\u00a0 Which way the dollar will go, I don&#8217;t know, but weaker commodity prices mean a fall is on the cards.<\/p>\r\n<h2>Real Prices Are Falling<\/h2>\r\n<p>Lately, inflation has been well above average for this century.\u00a0 In Australia, it has been <a href=\"https:\/\/www.rba.gov.au\/inflation\/measures-cpi.html\">around 6.6%<\/a> over the past year.\u00a0 Because Tesla is lowering prices while there is still moderate inflation it means the price fall in real terms has been even greater.\u00a0 While many people&#8217;s income hasn&#8217;t kept pace with inflation, it doesn&#8217;t mean Tesla car prices haven&#8217;t decreased in real terms.\u00a0 It instead, unfortunately, means these people have grown poorer.<\/p>\r\n<h2>EVs Are Getting Cheaper<\/h2>\r\n<p>EVs are falling in price.\u00a0 Recently Volvo said they&#8217;d release one in 2025 for $27,000 US.\u00a0 Immediately after that, Elon Musk said Tesla would sell an EV in 2025 for $25,000 US. \u00a0This car would cost around $41,000 in Australia at the current exchange rate and with GST.\u00a0 Unfortunately, even if Elon isn&#8217;t telling a pork pie, it may not be available in Australia until after 2025. \u00a0<\/p>\r\n<p>I advise getting an EV if you&#8217;re in the market for a new car and have plenty of money.\u00a0 They&#8217;re better than similar-priced conventional cars.\u00a0 If you want a new car but don&#8217;t have plenty of money, try to hold out for a while.\u00a0 Whatever you do, don&#8217;t buy a brand-new petrol or diesel burner.\u00a0 They will rapidly depreciate in value as EVs continue to fall in price and improve in quality.<\/p>\r\n<p>While the recent Tesla price falls have tempted me to buy an EV, they are still a little &#8212; or maybe a lot &#8212; out of my price range.\u00a0 I&#8217;m going to hold off and ride a bicycle for a while.\u00a0 It&#8217;s either that or losing enough weight so I can ride my horse again.\u00a0<\/p>\r\n\n\n","protected":false},"excerpt":{"rendered":"<p>In good news for Americans: Tesla cut electric car prices yesterday. In good news for Australians, we&#8217;re still paying less than Americans for the cheapest Model 3 (excluding government charges or incentives).<\/p>\n","protected":false},"author":10,"featured_media":73771,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[684],"tags":[],"class_list":["post-73721","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-electric-vehicles","entry"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.2 (Yoast SEO v27.2) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Aussies Pay $4,000 Less Than Americans For Tesla Model 3 RWD<\/title>\n<meta name=\"description\" content=\"Despite Tesla cutting its prices again in the USA, the list price of a Model 3 RWD is about $4,000 less in Australia.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.solarquotes.com.au\/blog\/model3-australia-cheaper-than-usa\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Australians Pay $4,000 Less Than Americans For Tesla Model 3 RWD\" \/>\n<meta property=\"og:description\" content=\"Despite Tesla cutting its prices again in the USA, the list price of a Model 3 RWD is about $4,000 less in Australia.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/www.solarquotes.com.au\/blog\/model3-australia-cheaper-than-usa\/\" \/>\n<meta property=\"og:site_name\" content=\"SolarQuotes Blog\" \/>\n<meta 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Their findings were: Not many Electric Vehicles have had batteries replaced so far. The decline in range of the\u2026","rel":"","context":"In &quot;Electric Vehicles&quot;","block_context":{"text":"Electric Vehicles","link":"https:\/\/www.solarquotes.com.au\/blog\/category\/electric-vehicles\/"},"img":{"alt_text":"a very old Tesla","src":"https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/05\/ev-battery-life.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/05\/ev-battery-life.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/05\/ev-battery-life.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/05\/ev-battery-life.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2023\/05\/ev-battery-life.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":20796,"url":"https:\/\/www.solarquotes.com.au\/blog\/tesla-powerwall-2-price-increase\/","url_meta":{"origin":73721,"position":3},"title":"Tesla Increases Cost Of Powerwall 2 To $9,600 &#8212; Not Including Installation","author":"Ronald Brakels","date":"April 24, 2018","format":false,"excerpt":"Sorry I've been slow in reporting this, but back in February Tesla raised the price of a Powerwall 2 in the United States by 400 Mickey Mouse dollars; an increase from US$5,500 to US$5,900.\u00a0 We've also copped it sweet here in Australia and the price has increased by $600 to\u2026","rel":"","context":"In &quot;Battery Storage&quot;","block_context":{"text":"Battery Storage","link":"https:\/\/www.solarquotes.com.au\/blog\/category\/battery-storage\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/04\/powerwall2-cost.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/04\/powerwall2-cost.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/04\/powerwall2-cost.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/04\/powerwall2-cost.jpg?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/www.solarquotes.com.au\/blog\/wp-content\/uploads\/2018\/04\/powerwall2-cost.jpg?resize=1050%2C600&ssl=1 3x"},"classes":[]},{"id":78611,"url":"https:\/\/www.solarquotes.com.au\/blog\/ev-service-costs-tesla-mini\/","url_meta":{"origin":73721,"position":4},"title":"Fobbed Off! 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