Tesla cuts Model 3 price for second time this year Reuters

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Tesla has lowered the price of its Model 3 by $1,100 amid reports that USA sales fell precipitously in January despite a $2,000 reduction that went into effect at the beginning of the month.

The most affordable Model 3 now starts at $42,900 before incentives, the result of the most recent $1,100 price cut.

In a reply to a Twitter user asking about when Tesla would drop the Model 3 base price to $35,000, without credits, Musk said, "We're doing everything we can to get there.

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The latest quarterly report suggests Tesla is making progress in lowering production and component costs for the Model 3, slashing man-hours required to build each unit.

Reminded by a Twitter follower that the promise was for a $35,000 vehicle without the fancy accounting, Musk replied: "We're doing everything we can to get there". CEO Elon Musk says the Model 3 must be competitive with gasoline-fueled cars for the company to succeed. "It's a super hard grind".

The billionaire in the past few months has been pushing for cost-cutting initiatives, like cutting jobs and ending a customer referral program.

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Earlier this year Tesla cut the prices of all models by $2,000, citing the upcoming demise of the $7,500 federal tax credit.

"Getting those costs down...is what allows us to lower price and become financially sustainable and achieve goal of environmental sustainability", Musk said.

The referral program that ended at the beginning of February gave new buyers six months of free charging and prizes for existing owners such as launching personal photos into deep space or invites to a Tesla event.

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