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Tesla Confirms Model 3 Price of $35,000
Tesla confirmed on February 9 that the price of the Model 3 will be $35,000 before any incentives. Spokesperson Khobi Brooklyn says it is on time and the company will have a lot more to say when the official reveal occurs in late March.
Bloomberg reported on February 9 that the starting price for the upcoming Model 3 will indeed be $35,000. That information was confirmed by Tesla spokesperson Khobi Brooklyn, who told Bloomberg, “We can confirm it’s $35,000 before incentives. We haven’t changed our minds.” More than a year ago, Elon Musk told reporters, “When I say $35,000, I’m talking about without any credits.”
EV incentives start with the $7,500 federal tax credit that anyone who buys a qualifying electric or plug-in hybrid car is eligible for. (That’s assuming the buyer actually has a federal tax liability of $7,500.) On top of the federal credit, many states offer incentives of their own. Colorado has the highest state benefit — $6,000. California, Massachusetts and Tennessee offer EV buyers $2,500. Rhode Island has just announced a $2,500 incentive, but there are only enough funds to cover less than 100 cars before the money runs out.
That means a Colorado resident could potentially park a Tesla Model 3 on the driveway for as little as $21,500. The average price of a new car today is $31,000, according to Bloomberg New Energy Finance analyst Salim Morsy. Almost all the mass market vehicles above that price are SUVs or trucks, Morsy says. The BMW 3 series sedan is the closest vehicle in size to the Model 3 that sells more than 100,000 units a year. It’s starting price is $35,000 and, of course, there are no incentives to buy one.
Before we get carried away, though, there are a few speed bumps on the road to the $35,000 Model 3. Tesla will reveal first pictures of the Model 3 next month but it’s likely that Tesla will offer Signature Series cars in its initial run for those willing to pay large deposits. After all, that’s what it did with the Model S and Model X. Those Signature Series cars were priced considerably higher than many people expected.
There is also the possibility that the Model 3 doesn’t go on sale in 2017. Morgan Stanley analyst Adam Jonas is on record as saying he doubts the Model 3 will arrive before 2018. And when it does, early cars may be loaded with expensive options the way the Model X Signature Series cars were. Jonas wouldn’t be surprised if the first cars off the assembly line were priced close to $60,000.
Keep in mind, the federal tax credit begins to phase out after a manufacturer sells 200,000 electric cars. If the Model 3 is delayed, Tesla may be close to the point where that phase out begins. As Bloomberg says, at some point, that $35,000 Model 3 is going to just be a $35,000 Model 3, subject to whatever state incentives are available.
Want to know more? You will have to wait for the March reveal. “The Model 3 is on time, and everyone is going to learn more about it at the end of March,” Khobi Brooklyn says. “That’s when we’ve committed to talking about it and giving a really great update, and that’s what we’re going to do.”
Chart: Bloomberg Business. Photo credit: Tesla Motors
Tesla revealed plans to develop its own maps internally to fix Navigation issues and give owners more control over their routing.
On the company’s Q3 2026 Earnings Call, a question was asked about FSD Navigation issues, particularly speed limit recognition, parking, and routing. These are issues that surface from version to version and seem to be seriously challenging for Tesla’s AI team to resolve.
Tesla’s Head of AI, Ashok Elluswamy, said in response to the question:
“You’re totally right that we shouldn’t be depending on external people’s maps. So we are building our own maps, but not like the same way as OneMoreMap. We are building an entirely new architecture with essentially AI-based mapping and navigation.”
He continued:
“It’s going to be super awesome. It’s going to be integrated with voice. You can talk to it, ask for different routes. It’s going to learn your personalized preferences, plus the fleet preferences. The collective intelligence of all the cars is going to flow into making the maps and navigation super cool.”
Elluswamy said this issue should be confronted, and the mapping should be available for people by the time the v15 release starts deploying to customers.
“And over the next several months,” he added, “it’s just going to take over all of the navigation functions, parking, destination handling. And it will know you better than you know yourself in some regard for the driving task, and then handle it fully.”
Tesla Summon got insanely good in FSD v14.3.2 — Navigation? Not so much
Navigation is perhaps the most notable complaint with FSD, and although it has gotten better, it is still flawed. Much of the time, FSD will take people on routes that are not preferred by the driver, but Tesla tried to combat this with a routing feature in the Summer 2026 Update.
Tesla currently relies on Google for map data, but it is sort of counterintuitive to believe the company would rely on a third party for this. These improvements will be welcome, as routing and navigation have been such a pain point for so many owners for so long.
Quotes via Motley Fool
Tesla Full Self-Driving (Supervised) showed a record attach rate at delivery for new vehicles in the third quarter of 2026.
75 percent of new vehicle deliveries in North America included a subscription to FSD software, up from 55 percent in the prior quarter, a 20-percentage-point sequential gain in the company’s most mature market.
Tesla Q3 2026 Earnings results: in-line revenues, slight beat on EPS
Tesla shed light on the Q3 Shareholder Deck that 75 percent of new deliveries came with an FSD subscription:
“FSD (Supervised)⁴ attach rate continued to grow, reaching over 75% of new vehicle deliveries in North America – our most mature market – a nearly twenty percentage point sequential increase. We believe that FSD is driving demand in markets where it is available, and we continue to work with regulators to get it approved in other markets. “
The higher attach rate accompanied strong growth in the overall FSD consumer base, as active subscriptions rose to 1.75 million, a 67 percent year-over-year increase. For the first time, more than half of paid customers are on the monthly subscription, which is priced at $99 per month in the U.S.
People are buying FSD with a car attached, not the other way around
— Elon Musk (@elonmusk) October 21, 2026
The transition to subscriptions has accelerated since Tesla discontinued the one-time purchase option in most markets earlier this year. The recurring model improves revenue visibility and margins compared with large upfront payments. With three-quarters of North American deliveries now including FSD, the software is now an evidently large contributor to Tesla’s economics and ancillary revenue.
Geographic expansion remains important for further gains. FSD is now available in nine countries in the EU, and more than 100,000 customers have driven over 160 million kilometers. Tesla is pursuing broader EU-wide approval, with a related vote expected in December. Similar progress in additional markets could support higher attach rates beyond North America.
These results came as Tesla had a strong quarterly delivery performance of 486,532 vehicles in the quarter, which came with its largest passenger-vehicle backlog in four years. Battery supply continued to limit volume, but the company has pointed to FSD as a clear difference-maker that is helping sustain demand. As supervised capabilities improve, the attach rate will likely continue to improve.
At face value, it is a key measure of how Tesla is converting sales into autonomy progress.
Update: 10/22 10:51a – Para 1 consumers changed to “customers” for accuracy.
Tesla Cybercab units finally got a definitive date for when they will be able to be purchased by customers, ending speculation regarding whether the fully autonomous vehicle would be available in the near term.
During Tesla’s third-quarter 2026 earnings call on October 21, Vice President of Engineering Lars Moravy said the company is aiming to begin delivering its purpose-built Cybercab robotaxi to customers before year-end.
🚨 In short, Cybercabs are slated to go to customers by end of the year. All units are going into Robotaxi fleet currently, per @larsmoravy
Cybercab will be “transport-as-a-service,” but vast majority of Cybercab will be “Tesla-owned,” @elonmusk says https://t.co/R8Qu8QWdmp
— TESLARATI (@Teslarati) October 21, 2026
“We’re trying to get Cybercabs to customers by the end of this year, 2026,” Moravy said. He added that production is underway on the line at Gigafactory Texas, but “all of those are currently going to our own internal Robotaxi fleet.”
Moravy explained that as operations scale, Tesla will “mainly deliver fully designed autonomous vehicles to our customers,” with the Cybercab as the first such vehicle. Initial customer deliveries will start small while the company gains experience with delivery logistics, ownership models, fleet management, and operating autonomous vehicles outside its direct control.
CEO Elon Musk reinforced the limited nature of private sales, describing the Cybercab primarily as a “transport-as-a-service” offering rather than a personal ownership vehicle like the Model 3, Model Y, or upcoming Roadster. “The vast majority of the Cybercab stuff will be Tesla-owned and transport-as-a-service,” Musk said.
The Cybercab is a two-seater vehicle developed by Tesla without a steering wheel or pedals. It relies completely on Tesla’s Full Self-Driving suite and has been in production since February. Early units have been put in Tesla’s Robotaxi service as of early September, when the company launched rides to the public. Tesla previously indicated it would aim to sell Cybercabs for about $30,000.
Unsupervised Full Self-Driving is expected to ship to consumer cars during Q2 2027, Ashok Elluswamy, Tesla’s Head of AI, indicated during the call. Early buyers or fleet operators may receive vehicles whose autonomous operation remains geographically restricted due to lagging regulatory agencies. There are some hurdles that remain ahead of Cybercab deliveries.
Tesla is building its own maps to fix Navigation issues
Tesla buyers are buying for Full Self-Driving and not for the car, data shows
