Tesla to shut all of its physical store to drop price of Model 3 to $35,000

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Tesla is due to close all of its stores as part of a dramatic cost cutting drive to allow it to drop the starting price of its hotly anticipated standard Model 3 cars.

Elon Musk has announced that his pioneering electric car company will move to pull the shutters on its global physical retail estate, moving sales online.

This comes alongside the release of the Tesla Model 3, long hailed as the company’s equivalent of the Ford Model T, bringing electric vehicles to the masses at an affordable price of $35,000 (£26,400).

Though details of just how many of Tesla’s physical retail stores are due to shut, Musk says the move is necessary in order to offer the Model 3 at such a low base rate, down from the previous starting price of $42,900 (£32,000).

It is also understood that the move will allow Tesla to reduce the price of the rest of its range, including the Model S and Model X, by six per cent.

Some stores could reportedly be left open to serve as galleries and information centres.

“This is the only way to achieve the savings for this car and be financially sustainable,” Musk said.

“It is excruciatingly difficult to make this car for $35,000 and be financially sustainable.”

Tesla estimates that there is already enough demand for the car to sell around 500,000 cars per year at the new price, with customer who order now expected to receive their vehicles by before June when the tax cut for electric vehicles will be cut in the US.

According to Electrek, the Model 3 is now available for purchase, boasting a 130mph top speed and a 5.6 second 0-60 acceleration speed.

Options for an improved interior and battery pack will also be available for an extra $2000.

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