On October 8, Tesla rolled out two budget-friendly models. However, Bloomberg columnist Liam Denning contends that Musk’s cost-cutting strategy is misguided. Denning asserts that true cost reduction should stem from innovation and the adoption of new technologies, rather than merely trimming features from existing models.

The newly released “Standard” versions of the Model Y and Model 3 both boast a driving range of 516 kilometers. Yet, they fall short in acceleration performance compared to their high-end counterparts. These entry-level models are devoid of the Autosteer driver assistance system, lack rear-seat touchscreens, and the Model Y has been stripped of its LED light strip. Additionally, both models are outfitted with fabric seats. The starting prices for these two models are set at $36,990 and $39,990, respectively, with deliveries anticipated between December 2025 and January 2026.

Analysts point out that the new models offer only a roughly $5,000 price reduction compared to the high-end versions, making them less appealing to potential new buyers. Consequently, Tesla’s stock price took a 4.5% hit.