Tesla’s new 244-mile range Model Y was previously called “unacceptable” by Elon Musk, but we believe it’s far from the case and will sell like hotcakes.

Tesla Model Y standard range is ‘unacceptable’

If you missed it, last night, we reported on Tesla launching a new Model Y Standard Range RWD with 244 miles of range.

The launch was surprising considering CEO Elon Musk said that Tesla won’t produce the version of the Model Y because he said that the range would be “unacceptably low” at less than 250 miles.

Tesla released the version of the vehicle with an EPA estimated range of 244 miles and a starting price of $42,000.

A little more range than originally announced in 2019 for the base version (230 miles), but it’s also a little more expensive than originally announced ($39,000).

The new Model Y is far from ‘unacceptable’

When Musk made the comment last summer, we were disappointed because we thought that the version was viable:

“Personally, I don’t like this fixation on the range. 230 miles on a single charge is plenty for most people, especially if you can bring the price under $40,000.”

Now, Tesla made it a little more expensive than that, but it also increased the range a little.

Nonetheless, I stand by the comment, and I think the Model Y Standard Range will sell very well.

It reduced the starting price of the Model Y by $8,000.

Of course, for that price difference, buyers not only lose 80 miles of range but also the dual motor powertrain.

However, I am certain that many people are going to for that trade off, and that’s why Musk changed his mind.

For most markets, 244 miles of range will be plenty and actually competitive with other vehicles in the segment.

For example, the VW ID.4 has an EPA estimated range of 250 miles, and the base version of the Ford Mustang Mach E has 230 miles of range.

Access to more EV incentives

Another reason we think that the new Tesla Model Y is going to sell like hotcakes is the access to EV incentives.

In the Quebec, the Model Y will now for the first time have access to the generous $8,000 provincial incentive since it brings the base price down to $55,000 before destination fees.

The Model Y is expensive in Canadian dollar and didn’t have access to incentives. This is going to make a massive difference.

Furthermore, there’s a possibility that the standard Model Y Standard Range with the 7-seat option could become eligible to the $5,000 federal incentive.

The government lists the eligibility as the following:

a vehicle with seven seats or greater, where the base model Manufacturer’s Suggested Retail Price (MSRP) is less than $55,000; higher priced versions (trims) of these vehicles, up to a maximum Manufacturer’s Suggested Retail Price (MSRP) of $60,000, will also be eligible for purchase incentives;

The $5,000 would be available country-wide and in Quebec, combining the two incentives would add up to a $13,000 discount on the Model Y.

While the situation is less clear in the US, the new base price of the Model Y could help there too.

Now with the Democrats firmly in charge of the federal government, we expect them to reform the federal tax incentive for electric vehicles.

We wouldn’t be surprised if the new version of the incentive, which should give back access for Tesla buyers by removing the delivery threshold, would come with a price limit on the vehicles in order to avoid incentivizing sales of luxury electric vehicles.

What do you think? Let us know in the comment section below.

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