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Tesla Motors (TSLA) Delays Brexit Price Increase Due To High Demand

Tesla Model 3 (TSLA)

Tesla Motors Inc buyers in the UK may find their Christmas cash last a little longer than expected as the EV firm has delayed the price increase by two weeks. In an emailed statement to AFR, the electric carmaker said the plans to raise prices by 5% in the UK had been put off until mid-January from the original beginning-of-the-year deadline.

“High demand” Causes Tesla to Delay

The Palo Alto-based manufacturer promised to ring in the New Year with a price hike in the Brexit-ready UK, however, this is one resolution that is going to take a little longer to launch. This means that the previously scheduled price hike of 5% on all cars made by Tesla will still happen, but not on January 1. The price hike is now scheduled fifteen days later – 15th January.

Also, Tesla Motors Inc said the cars ordered by then and build by mid-April will continue to have free access of the Supercharger battery network. “Due to exceptionally high demand at the end of the year, we’ve extended the order date by two weeks for customers who were unable to finalize their purchase,” the EV firm said.

In response to the decline in the value of pound since Brexit referendum in June, the electric carmaker is hiking prices in Britain.  The pound is about 17% weaker in comparison to the dollar since the Brexit vote took place last summer. In addition, it is around 10% weaker than the euro. This makes a substantial difference on an electric car that begins at 58,900 pounds.

The US firm gave consumers only a week’s notice of the shift in prices. As per its website, the Model S – Tesla’s most popular car – costs £58,900 ($100,600) now. The website also says that drivers save about £6500 on taxes and fuel over a five-year period.

Prices gone up for other products too

Since the Brexit vote, prices of all sort of things have gone up, from Toblerone to wine to books to general consumer products like shampoo, soap, etc. Apple also raised the price of some of its laptops by around 20%.

Tesla Motors Inc (TSLA) Factory Freemont, California

In October, the supermarket operator Tesco pulled items from its shelves due to the price dispute – inspired by Brexit – with supplier Unilever.

So, it is not just electric cars fans that are feeling disappointed. It will be interesting to watch what impact will this 5% price hike on Tesla Motors Inc Model X and S UK sales.

Tesla shares were in the green in the pre-market trading. In 2016, shares were down almost 11% while in the last one-month, they are up almost 18%.

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Aman is MBA (Finance) with an experience on both marketing and Finance side. He has work as a Risk Analyst for AIR Worldwide, and is currently leading VeRa FinServ, a Financial Research firm. Favorite pastimes include watching science fiction movies, playing PC games and cricket.

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