Tesla hit the brakes on its store-closing plan, rescuing many of the outlets it promised to close just 2 weeks ago

  • Tesla on Sunday said it was shuttering significantly fewer stores than it previously announced.
  • Only two weeks ago, the electric-vehicle firm said it was closing most of its stores and moving to an online-only sales model so it could slash vehicle prices by 6%.
  • Now it says it will instead lower prices by 3% while saving some stores.

Tesla has hit the brakes on its plan to shutter its stores and slash the price of its cars.

At the end of February, Tesla announced plans to close most of its stores and move to an online-only sales model as a way to lower prices for its cars.

“Shifting all sales online, combined with other ongoing cost efficiencies, will enable us to lower all vehicle prices by about 6% on average, allowing us to achieve the $US35,000 Model 3 price point earlier than we expected,” the company announced.

On Sunday, however, the company said it would be keeping more stores open than expected.

“Over the past two weeks we have been closely evaluating every single Tesla retail location, and we have decided to keep significantly more stores open than previously announced as we continue to evaluate them over the course of several months,”Tesla said in a statement.

Read more:
‘It feels like a morgue’: Tesla employees say morale has fallen drastically as stores close and workers are let go

Keeping more stores open will affect the price of its cars.

“As a result of keeping significantly more stores open, Tesla will need to raise vehicle prices by about 3% on average worldwide,” the firm said. “In other words, we will only close about half as many stores, but the cost savings are therefore only about half.”

Tesla added that the price hike would not come into effect until March 18.

The electric-car company was eager to stress that it still planned to move toward an online-only sales model, despite keeping more stores open.

“To be clear, all sales worldwide will still be done online, in that potential Tesla owners coming in to stores will simply be shown how to order a Tesla on their phone,” it said, adding that stores would carry a small inventory of cars so customers could drive away with a car straight away.

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