Tesla's long-promised US$35,000 electric car still remains somewhere down the road, but little by little the company is edging towards this kind of mass market pricing for its increasingly popular Model 3. The company has today shaved just over $1k off the cost of its cheapest offering, meaning pricing now starts at $42,900.

Tesla's Model 3 has garnered huge interest since it was announced in April 2016 alongside a pledge to offer an electric sedan at a price point of $35,000. Though it has not yet reached that mark, it is now shipping higher-end versions of the car in numbers that are unparalleled in the EV market, with the Model 3 becoming the best-selling luxury car in the US for 2018.

Tesla offers three variants of the Model 3, with the mid-range version covering 264-mi (424 km) on each charge the cheapest of its offerings. The company introduced this with a sticker price of $45,000 last October and soon after dropped the price to $44,000 in response to a diminishing federal tax incentives for electric car buyers in the US.

Once $7,500, then reduced to $3,750 from January 1, this tax incentive will again be reduced to $1,875 in July before disappearing entirely at the end of the year. This means that Tesla's cars are essentially becoming more expensive, adding another degree of difficulty in its mission to meet the magical $35,000 mark.

With a sticker price of $42,900, the mid-range, rear-wheel drive Model 3 now costs $39,150 inclusive of the current tax incentives. But, perhaps cheekily, Tesla likes to factor in gas savings over a six year period when presenting the pricing of electric cars on its website too, which it says brings the actual cost to $34,850. That is unsurprisingly seen as misleading by some, but CEO Elon Musk maintains it is a sound way of marketing electric cars, with this to say in response to a complaint on Twitter.

"Both prices are shown right next to each other & lower price is *actually* the real apples to apples cost vs a fuel car," he tweeted. "In fact, for many states in the US, it's way better."

He also touched on the company's progress toward actually offering a $35,000 sedan without tax credits and fuel savings, something seen as pivotal to the company's long-term plans.

"We're doing everything we can to get there," he said. "It's a super hard grind."

Source: Tesla

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