Tesla launches “affordable” versions of Model 3 and Y, but with just 14% off base prices

Tesla has finally unveiled new “affordable” versions of its Model Y and Model 3 electric cars, although the scale of price reductions is less than what has been hoped.

The company has been working on its “affordable” variants for several years, although it has long ditched its one time promise of delivering a $US25,000 EV, instead turning most of its focus to autonomous driving technology.

In a post on X, Tesla announced the release of the new Model 3 Standard sedan and the new Tesla Model Y Standard SUV. Both will start under $US40,000, priced from $US36,990 for the Model 3 and $US39,990 for the Model Y.

These prices are 14 per cent below the previous base RWD Model 3, and 11% down from the RWD Model Y in the US, which is not as much of a discount as many hoped. And it means that following the removal of EV incentives in the US, the price of the new standard variants are actually higher than the old base models.

Both Standard models feature a 69 kWh battery pack, delivering over 500 km of EPA range. Charging speeds of up to 225 kW are on offer, which is an upgrade over the Model 3 and Model Y RWD found in the Australian market.

This range will be available with the car’s 18-inch wheels with aerocovers on them. Styling for both models is similar to the current line up, although the Model Y Standard has a more Model 3 like headlights.

The glass roof remains, but is closed off on the inside with a fabric, in-line with the rest of the interior. 

On the inside, these base models cut costs by having textile for seating, manual adjustments, a  7-speaker audio, and no rear screen, but they retain Hardware 4 for FSD Supervised capabilities and a front bumper camera.

Other specs worth noting is the towing capacity of the Model Y, which is rated at around 1,600 kg, similar to the RWD Model Y offered in our market.

As of now, this model will be available only in the US market with deliveries expected to start in a couple of weeks. It’s unclear when this model will be produced in Shanghai or Berlin for other key Tesla markets but we expect to have more details in the coming months.

We look forward to covering these changes and seeing it down under by early next year. 2026 is looking to be a very interesting year for Australia’s best-selling EV brand with both more affordable models and FSD Supervised subscriptions around the corner.