Tesla shuts up shops to lower Model 3 starting price

Tesla is set to close its shops In a cost cutting measure which the company says will enable it to lower the starting price of its model 3 to $35,000 (£26,000).

The move to online only sales should also enable the electric car maker to lower prices on its higher-end Model S and Model X.

The model 3 is currently priced at $42,900 (£32,400).

Chief executive Elon Musk has said that a shift to selling online only was essential in order to make a lower starting price financially viable for the company.

He said: “This is the only way to achieve the savings for this car and be financially sustainable. It is excruciatingly difficult to make this car for $35,000 and be financially sustainable.”

The store closures follow a decision to cut 3,150 jobs (7% of its workforce), which was announced in January.

It is understood that some galleries and information centres, which are situated in high footfall areas, will remain open, but Musk declined to comment on numbers. The company has 378 stores and service locations worldwide.