New variants of the Tesla Model Y and Model 3 have been released, but according to analysts, they may not be enough to generate significant excitement among consumers. The new Standard variants have been stripped of features like panoramic roofs, ambient lighting, and second-row screen displays in an effort to cut costs.
Analyst Insights
Goldman Sachs analyst Mark Delaney has maintained a Neutral rating on Tesla, with a price target of $425. Delaney notes that the changes to the Standard variants are more drastic than initially expected, and the degree of differentiation in terms of price and features is limited.
Key Takeaways
- The new Standard variants of the Model 3 and Model Y have lower starting prices, with the Model 3 starting at $36,990 and the Model Y starting at $39,990.
- The vehicles lack unique features and design elements, making them less distinctive in the market.
- Tesla had initially planned to introduce a new model that would be 50% cheaper than the Model 3 and Model Y, but instead, the company has released variants of the existing models.
Market Impact
Delaney believes that the new Standard variants may not be enough to drive significant growth for Tesla, and that the company’s focus on these models may not yield the desired results. Instead, the analyst suggests that the Tesla Model Y L, which was launched in China, could be more important for the company’s growth, particularly in the three-row SUV market in the United States.
Risks and Challenges
The analyst highlights several key risks for Tesla, including:
- Increased competition in the electric vehicle market
- Potential price cuts
- Slower EV demand
- Larger-than-expected tariff impacts
- Delays in products like FSD
- Operational risks associated with the company’s vertical integration
Stock Performance
Tesla stock traded at $433.21 on Wednesday, within a 52-week trading range of $212.11 to $488.54. The stock is up 14.2% year-to-date in 2025.
What’s Next for Tesla?
As the company continues to navigate the competitive electric vehicle market, it remains to be seen whether the new Standard variants will be enough to drive growth and excitement among consumers. With the potential launch of the Model Y L on a global basis next year, Tesla may be poised for significant expansion, but only time will tell if the company can overcome the challenges and risks facing it.