Why Tesla Isn't Exactly Rushing to Sell the Cheap Model Y

Tesla, despite actively promoting its new, more affordable version of the Model Y electric vehicle, doesn't seem to be actively trying to sell it, especially in the US market. This opinion was expressed by Fred Lambert in an article on Electrek, after analyzing the situation with the new model and comparing it with the company's previous steps. Let's figure out why Tesla might be deliberately limiting the appeal of its new product.

The Cybertruck Story: Déjà Vu?

To understand the current situation with the Model Y, it's worth recalling the recent experience with the Cybertruck. In April 2025, Tesla introduced a cheaper rear-wheel-drive version of the Cybertruck RWD, which cost $10,000 less than the all-wheel-drive model and lacked a number of features worth about $20,000. However, by September, production of this version was discontinued — it lasted only six months. Experts suggest that Tesla did not initially plan to actively sell the Cybertruck RWD. Instead, the model may have served as a marketing tool to make the all-wheel-drive (AWD) version more attractive to buyers. It seems that Tesla is applying a similar strategy with the new Model Y Standard.

New Model Y: What Has Changed?

Earlier, Tesla introduced a new version of the Model Y Standard, which costs $5,000 less than the Model Y Long Range RWD, now positioned as "premium." It is also cheaper than the all-wheel-drive (AWD) and Performance versions. However, for this price difference, the buyer loses features estimated to cost $6,000–$8,000. Among the excluded options are autopilot, a glass roof (replaced by an interior headliner), premium seats replaced with cheaper fabric ones, and even power-folding mirrors.

The price savings seem insignificant, considering the volume of lost features. This makes the value proposition of the new model questionable, which, according to Lambert, may be part of Tesla's strategy.

Financial Conditions: Leasing and Loans

Another factor indicating a slowdown in sales is the lack of leasing options for the new Model Y Standard. This is not uncommon for new Tesla models — for example, leasing is still not available for the Model Y Performance in the US. However, it is more telling that Tesla offers financing for the Model Y Standard with an annual interest rate that is 30% higher than for the "premium" Long Range RWD version.

As a result, the difference in monthly payments between the Standard and Premium RWD is only $72. For comparison, the difference in payments between the Premium RWD and AWD is almost identical, but for that money, the buyer gets an additional engine and all-wheel drive. This makes the choice in favor of more expensive versions obvious, which is probably Tesla's goal.

Why Is Tesla Doing This?

Apparently, Tesla is deliberately reducing the attractiveness of the Model Y Standard in order to direct buyers to more expensive versions — Long Range RWD, AWD, or Performance. The $5,000 price reduction is accompanied by a loss of features that make the model less competitive. The high interest rate on the loan and the lack of leasing further complicate the purchase.

This approach may be part of Tesla's strategy to maximize profits. By making the base model less attractive, the company encourages customers to choose premium versions, which bring more revenue. A similar tactic has already been used with the Cybertruck, and, apparently, Tesla is repeating this scenario.

The new Model Y Standard, despite its lower price, does not look like a bargain. The removal of key features, the high interest rate on the loan, and the lack of leasing make it less attractive compared to other versions of the Model Y. Tesla is likely using this model as a tool to promote more expensive trim levels, repeating the strategy already tested with the Cybertruck.