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Tesla increases prices on its Model 3 and Model Y vehicles

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Yahoo Finance’s Pras Subramanian reports details on Tesla’s fourth consecutive price increase.

Video Transcript

KRISTIN MYERS: Tesla is hitting customers with yet another price increase on their Model 3 and their Model Ys. We've got our resident car expert Yahoo Finance's Pras Subramanian here with all of those details. Hey, Pras. Great to have you in the 1:00 PM.

PRAS SUBRAMANIAN: Hey, Kristin, great to see you. So, you know, these price increases, right? What's going on here? It's just like big picture. Is this, like, Tesla eking out more profit, or is something else at play here? So, you know, last time, we had some price increases on some of their cars, right? What happened? We had the standard Model 3 Range Plus up 500 bucks, the Model 3 Long Range All Wheel Drive up 500 bucks. And the Tesla Model Y Long Range All Wheel Drive up 500 bucks, too.

But this is the fourth price increase in just over the last two months. So what does that mean? The cheapest Tesla you can buy is the Model 3 Standard Range Plus. That cost 37,000 bucks back in February. Now it's 39.5. So what does this mean exactly? And this kind of makes me think about this production report we saw last-- yesterday, where [INAUDIBLE] found that Tesla is telling their internal people that they've sold out their entire Q2 production. The whole run is sold out. So right now, they just gotta make cars to sell-- to fulfill its obligations and also create a Q3 backlog.

So if you ask me, that means that, you know, demand is greater than supply. They're charging higher prices here. It's not just commodity prices are higher. It's actually an EV wave is happening. We've seen that with BMW, Audi, also Volkswagen. They're actually seeing EV sales pick up. So I think this is more of the same here. And Tesla is actually trying to take advantage of that.

KRISTIN MYERS: What are you making of this move of Elon Musk on SNL this weekend?

PRAS SUBRAMANIAN: You know, the car world and the financial world is really geared up for this Saturday Night Live. And Elon's in New York. I'm going to probably throw a party for this. I want to watch that, have my friends come watch it. No, I'm just kidding. But, you know, what are we going expect, right? Wild card Elon. I mean, I'm thinking we're going to see some Dogecoin maybe. He's going to pump that up perhaps.

Maybe there's some Mars kind of skits. He's going to Mars. Maybe the Cybertruck makes an appearance. I'd like to see that. But you know, an SEC joke? I don't know. Maybe that would be pushing the line. But I think it's going to be kind of must see TV. I hate to say it, even if you don't like the guy, you still kind of got to watch.

ALEXIS CHRISTOFOROUS: You know what I'm wondering, guys? Are they going to poke fun at a sad and serious situation, but the Bill Gates, Melinda Gates breakup? Because we know that Musk and Gates are two of the wealthiest guys on the planet. That's another one. Could see a skit about that.


PRAS SUBRAMANIAN: I wouldn't hold it past Musk to make one of them.


KRISTIN MYERS: Elon Musk does always take potshots at a lot of other people. So I would not actually be surprised if he decided to go and do that. I mean, I'll have to watch. I don't typically watch SNL when it's live. But maybe I'll make an exception on this. Really quick, Pras, before we let you go, we have, like, 30 seconds left here. You were touching on what's happening in the EV space right now. Hoping you can give us a recap in terms of consumer demand and interest on electric vehicles. It seems as if every single car company now has one.

PRAS SUBRAMANIAN: Well, yeah, and you've got to think about-- you've got Ford, Mustang. Mustang Mach-E sales up, Volkswagen ID.4 sales up. BMW's electric car sales and so are Audi's. So, a lot of these big players that are actually in this space. And of course, Tesla had a huge Q1. So that EV wave is for real, and we saw that happen in April.

KRISTIN MYERS: All right, thanks so much, Pras Subramanian, for breaking all of that down.