Tesla CEO Elon Musk on Thursday opined that affordability is the top issue preventing large-scale electric vehicle adoption in the United States.
What Happened: “Affordability is the top issue by far,” Musk wrote on X, formerly Twitter. He was responding to an X user and Tesla enthusiast who noted that more people indeed want to buy an EV. Citing a poll that pegged the percentage of the population that wants to own an EV at 19%, the user noted that about 30 million EVs should be in the market as opposed to the current EV fleet of about 1.7 million.
“This study backs up notion Tesla doesn’t need to advertise – they need to lower costs,” the user wrote. “Hard to believe they aren’t aware of Tesla – likely waiting for the right price.”
Why It Matters: “Demand is very much a function of affordability not desire,” Musk said at Tesla’s investor day event in March.
In July, Musk warned that Tesla may further cut prices in the months ahead depending on larger market conditions and interest rates. Musk noted that the affordability of anything bought with debt decreases as interest rates rise. Up until recently, it was the sharpest interest rate rise in history and Tesla had to reduce the price of their cars because the interest payments increase the price of the car, Musk said.
True to his word, Tesla cut prices of Model S and X versions in the U.S. earlier this month with cuts ranging from 15.3% to 18.8%.
Elon Musk Photo by Frederic Legrand – COMEO on Shutterstock
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