Tesla (TSLA) launched a more-affordable Model Y rear-wheel drive standard-range SUV with a third-row seven-seat option. Tesla stock hit a fresh high.
With a base price of $42,000, the Model Y is only $4,000 more than Tesla’s cheapest car, the Model 3 sedan. The third-row option costs an extra $3,000. The Model Y SUV has an EPA estimated range of 244 miles. Deliveries of the vehicle will begin in two to five weeks in the U.S., the company said.
This version of the Model Y was initially introduced in 2019. But CEO Elon Musk said in July 2020 it would not be produced because the range would be “unacceptably low” at under 250 miles.
Tesla has been selling two other versions of the Model Y for nearly a year. The Model Y Long Range Dual Motor and Performance start at $50,000 before incentives in the U.S.
The Model Y is still more expensive than comparable vehicles like the Volkswagen’s (VWAGY) IG. 4 and Ford’s (F) Mustang Mach-E. They are priced at $32,495 and $35,395 respectively, when including a $7,500 federal tax credit for each car.
Shares rose 4.1% to new high of 849.69 on the stock market today. Tesla stock is well extended from a 466 buy point, according to MarketSmith chart analysis. After today, the eight-week hold rule expires. So an investor who bought Tesla, an IBD Leaderboard stock, at or near the buy point might consider whether to hold on longer or take some profit.
Tesla stock’s meteoric rally comes on the heels of the automaker’s record year-end deliveries. It delivered 180,570 vehicles in the fourth quarter for a total of 499,550 for 2020, just under its stated goal of 500,000. Yesterday’s 8% stock price gain made Musk the richest person in the world, replacing Amazon (AMZN) CEO Jeff Bezos.
Follow Adelia Cellini Linecker on Twitter @IBD_Adelia.
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