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Tesla Sinks as Price Cuts Signal a Ceiling for Costly Models

  • Automaker sold 63,150 Model 3 sedans in the fourth quarter
  • Prices cut by $2,000 to partially offset shrinking tax credit
Bloomberg business news
Tesla Misses Model 3 Delivery Estimates, Cuts U.S. Vehicle Prices
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No sooner did Elon Musk put a raucous 2018 behind him than a new worry erupted for Tesla Inc.: a potential ceiling in demand for its cars.

Tesla’s shares plunged on the first day of 2019 trading after the company unexpectedly announced it was cutting prices by $2,000. The move, designed to partially offset a reduction in the federal tax credit for its electric vehicles, underscored the key challenge in what is likely to be a pivotal year for the company and its chief executive officer. The carmaker also reported fourth-quarter deliveries that fell just short of analysts’ estimates.