Tesla introduced its most affordable version of the Model 3 in Europe on Friday, following its debut in the United States two months ago. The move aims to address the increasing competition and slowing demand in the European market in order to boost sales.
The electric car company is facing soft demand across Europe, with new registrations witnessing a significant drop, while also contending with competition from Volkswagen’s ID.3 and BYD’s Atto 3. These competitors are grabbing market share with prices below $30,000, posing a challenge to Tesla.
The launch of this new Model 3 is part of Tesla’s broader strategy for affordable vehicles. This strategy evolved after the cancellation of the $25,000 new electric car plan last year, shifting towards creating cheaper versions based on existing platforms to leverage economies of scale and strengthen its dominant position in the global electric vehicle market. This strategy was first demonstrated by the introduction of the low-cost model in the United States.
Dubbed as the Standard Range version of the Model 3, it is the most budget-friendly option in the Model 3 lineup, offering the most affordable entry-level pricing to date.
Tesla positions it as an option with “ultra-low cost of ownership,” achieved by removing some high-end decorations and features to keep the price low, while still providing over 300 miles (480 kilometers) of range. Compared to competing models in the European market at a similar price point, it still boasts significant range superiority.
The price of this model in Germany is €37,970, significantly lower than the “Premium Trim” priced at €45,970, which follows closely in the Model 3 family.
The Standard Range version is expected to begin deliveries in the first quarter of 2026.
While CEO Elon Musk is shifting the company’s focus towards AI-driven projects such as autonomous taxis and humanoid robots, this low-cost Model 3 is crucial for supporting the company’s recent revenue growth.