Here's how much each Tesla electric car costs to make

Tesla aims to reduce its vehicle production cost significantly and increase profit margin further.
By : HT Auto Desk
| Updated on: 30 Jan 2022, 01:01 PM
Per unit vehicle cost production for Tesla is currently $36,000 on an average. (Bloomberg)
Per unit vehicle cost production for Tesla is currently $36,000 on an average. (Bloomberg)
Per unit vehicle cost production for Tesla is currently $36,000 on an average. (Bloomberg)
Per unit vehicle cost production for Tesla is currently $36,000 on an average.

Tesla is one of the most valuable auto companies in the world worth around $1.6 trillion. Do you know how much each Tesla cars cost to produce? The average cost to make a Tesla electric car is an impressive $36,000. The US-based electric car major sells its cheapest car, which is the Tesla Model 3 Rear-Wheel Drive at a starting price of $44,990.

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Among others, the Tesla Model Y price starts at around $60,000, while the refreshed Tesla Model S and X prices start at $95,000 and $105,000 respectively. In fact, no other Tesla cars currently sell at a price point below $50,000, while the average manufacturing cost for all the Tesla vehicles presently is $36,000 per unit.

Tesla shared this information while revealing its cost per vehicle in the third quarter of 2021. The EV manufacturer aims to reduce the per-unit vehicle cost production further with the new battery technology that it is developing. Also, the structural battery pack, 4680 battery cells, large castings are also likely to reduce Tesla's future per unit vehicle production cost. Another major cost-saving measure adopted by the EV manufacturer is that it doesn't spend money on advertising like other traditional OEMs.

"We believe our current projects, including large castings, structural battery pack, 4680 cells and many others, should help us continue to minimize our product cost," Tesla has said. Clearly, Tesla is currently one of the most profit-making car brands in the world and it is aiming to increase the ratio further by reducing vehicle production costs.

In the initial days of the company, sceptics argued that Tesla could never be profitable, as they said electric vehicles are structurally unprofitable because of highly expensive batteries and other reasons. In fact, this is one of the reasons why traditional automakers have been sceptical about EV adoption.

How, Tesla remained confident that innovations in manufacturing paired with purpose-built vehicles and factories could be a viable solution to the EV production expense problem. As it appears, Tesla's strategy is perfectly working and inspiring other car brands as well.

First Published Date: 30 Jan 2022, 11:23 AM IST
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