Tesla Keeps Stores Open But Hikes Prices

Mon 11th Mar 2019

US electric car manufacturer Tesla has announced a u-turn on its store closure programme, but at the same time revealed it will be raising prices by three per cent on many of its models.

Tesla had committed to closing an unspecified number of stores earlier this month, with the aim of making its new Model 3 more affordable in an increasingly competitive market. The company has 378 stores and service locations across the globe and was planning on moving much of its sales operation online to help fund the price cut for the Model 3 to £26,400.

But a statement on the company’s blog has revealed the u-turn saying: “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.

“When we recently closed 10% of sales locations, we selected stores that didn’t invite the natural foot traffic our stores have always been designed for. These are stores that we would have closed anyway, even if in-store sales made up our entire sales model.

“A few stores in high visibility locations that were closed due to low throughput will be reopened, but with a smaller Tesla crew. In addition, there are another 20% of locations that are under review, and depending on their effectiveness over the next few months, some will be closed and some will remain open.”

The measures come after Tesla came to terms with one of its most challenging years, with owner Elon Musk causing controversy with his freewheeling tweets and the company announcing 7% of its workforce would be cut. Musk also admitted that the company’s cars were “too expensive for most people”.