Tesla Raises U.S. Model Y Long Range Price for First Time in Two Years

Tesla raised prices for certain Model Y variants in the U.S. market on May 16, 2025. The Long Range All-Wheel Drive (AWD) and Long Range Rear-Wheel Drive (RWD) versions each increased by $1,000, bringing their new prices to $49,990 and $45,990, respectively. The Performance AWD variant saw a $500 increase, now priced at $57,990. The base model’s price remained unchanged. Tesla did not disclose the reason for this adjustment. This marks Tesla’s first price increase for the Model Y since 2023. Previously, from early 2023 through 2024, the vehicle underwent multiple price cuts, with cumulative reductions reaching up to $13,000. In April 2024, Tesla set a record-low price for the Model Y, cutting some variants by as much as $2,000. These repeated discounts caused the company’s automotive gross margin to decline from over 25% in early 2023 to below 18% by mid-2025. This latest adjustment applies only to higher-end trims, with all increases under 3%. The U.S. midsize electric SUV segment remains highly competitive: the Hyundai Ioniq 5 AWD starts at around $45,000, and the Ford Mustang Mach-E Select AWD is priced at $42,995—both lower than the newly adjusted price of the Model Y Long Range AWD. Meanwhile, Tesla also raised the price of the top-tier Cybertruck by $15,000 in 2024.