The Tesla Model 3 Long Range recently qualified for the $7,500 US tax credit, and with a final opportunity for 1.99% APR financing on the Model 3 RWD, the Model 3’s affordability is undeniable.
However, with Americans favoring crossovers and SUVs, it’s crucial to assess the Tesla Model Y’s cost competitiveness against its main rivals in the US market.
Surprisingly Affordable
It turns out the Tesla Model Y is significantly more affordable than its competitors, even before factoring in long-term fuel savings. While opinions vary on which cars directly compete, focusing on similar size and class seems most appropriate for this comparison.
The BMW X4 and Audi Q5 appear to be the closest matches to the Tesla Model Y. Additionally, the Jeep Grand Cherokee, a top-selling SUV in the US, might also be considered by potential Model Y buyers.
Diverse Pricing Options
Each model offers various price points. The Model Y starts at $44,990, $47,990, or $51,490 before options and software features. The Audi Q5’s base MSRPs are $45,300, $52,200, and $57,700. The Jeep Grand Cherokee ranges from $36,495 to $67,040. The BMW X4 starts at $55,000, $66,400, and $79,100.
Tesla Takes the Lead
With the high-end Model Y starting at $51,490, it’s considerably cheaper than the top-tier versions of the Audi Q5, Jeep Grand Cherokee, and BMW X4. Therefore, Tesla already wins when comparing the best versions of these models.
Tax Credit Advantage
The Model Y’s eligibility for a $7,500 federal EV tax credit significantly lowers its cost compared to competitors. Here’s how the low-end pricing compares after applying the tax credit:
- Tesla Model Y: $37,490
- Audi Q5: $45,300
- BMW X5: $55,000
- Jeep Grand Cherokee: $36,495
Even without considering gas savings, the Audi and BMW are notably pricier. The Jeep Grand Cherokee is roughly the same price at the low end.
High-End Comparison
Applying the tax credit to the higher trim levels further highlights the Model Y’s advantage:
- Tesla Model Y: $43,990
- Audi Q5: $57,700
- BMW X5: $79,100
- Jeep Grand Cherokee: $67,040
The high-end Model Y is surprisingly competitive with the low-end Audi Q5 and BMW X5, and likely the Jeep Grand Cherokee when factoring in gas savings.
Unmatched Value
Considering the Model Y’s smoother ride, quicker acceleration, and zero emissions, it’s difficult to justify choosing one of its competitors. A comparison with other electric crossovers might present a fairer challenge. Perhaps that’s a topic for another time?