Yahoo Finance’s Emily McCormick joins Zack Guzman to break down the price cut on Tesla's Model S vehicle.
ZACK GUZMAN: We haven't chatted about Tesla in a while, so since we're overdue, let's dig into that company here today. They just announced a price change here in their Model S, that would be the more expensive model than the Model 3, but it is getting less expensive as they price cut that model. And for more on that, I want to bring I'm Yahoo Finance's Emily McCormick who has the details. Emily.
EMILY MCCORMICK: Well, Zack, we're taking a look here at Tesla's Model S vehicles. Both the starting and performance models have been slashed by $3,000 on that price tag here in the US. We have that long range plus Model S now available at $71,990 from a nearly $75,000 previously. We also have that Model S just below $92,000 from the just under $95,000 it had been selling for prior to this price cut. Now, this is the latest in a series of price reductions we've seen across Tesla's suite of vehicles. This latest one impacting the higher end vehicles, those Model S, as opposed to the Model 3 and the newer Model Y vehicles that we had just come out earlier this year.
Now, I want to highlight that just earlier this month, for example, we saw the cheapest version of the Model 3 seeing its price cut by about 8% to $37,000 after subsidies. And just earlier this year, we also saw a reduction in that Model Y vehicle. But again, these latest reductions are impacting that Model S. Now, I want to highlight that we have been seeing the Model S and the Model X actually performing more weakly compared to the Model 3 and that Model Y vehicle. If we take a look at the deliveries that we saw for the third quarter, those coming in at a record 139,300. Most of that strength coming from those lower price models. We actually saw global deliveries for the combined Model S and X at 15,200 in the third quarter. That was down 13% over last year while overall deliveries were actually up by 40%, so still seeing a bit of an anchoring, I guess you could say, in those deliveries from the higher end models.
So I also want to highlight here what we're seeing in terms of Tesla's share price today. We're actually seeing those shares trading to the upside, up just about 4/10 of a percentage point this afternoon. Typically, Wall Street has been somewhat less forgiving whenever they've seen Tesla actually come out and cut its prices for its US or vehicles made in China, but here we're actually seeing the stock trade higher. Part of that could be because of this really price reduction could unlock demand for a broader range of customers. We think about the fact that Tesla is trying to get around that half million range for full year deliveries, potentially stoking further demand here and helping it cross that finish line by the end of 2020. Zack.
ZACK GUZMAN: Yeah, should help a little bit in demand any time you make it a little bit cheaper, and that's no small price cut here at all. And Emily McCormick, appreciate you bringing us that.