Buy now or wait? Is the Tesla Model 3 about to get even cheaper in Australia?

One of Australia's most popular electric vehicles could be about to get even cheaper, with a decision in the USA to cause potential ripples for the Tesla Model 3 in our market.

Stateside, the cheapest Model 3 model is about to cease to qualify for a US$7500 federal tax credit (though more expensive variants still qualify) leading pundits to suggest another price cut could be on the cards for Elon Musk's EV brand.

And with history as our guide, Tesla price fluctuations tend to go global, suggesting the Model 3 could be cheaper in Australia in 2024.

According to US industry outlet Automotive News, the fact certain Model 3 models will soon fall outside the subsidy window, combined with slowing registrations, will likely force Musk's hand on pricing, with the EV company's boss on record as willing to slash prices to increase demand.

Currently, Australia's cheapest Model 3, the rear-drive model, lists at $61,900. Earlier this year, it was as low as $57,400 plus on-road costs, following three consecutive price cuts.

Tesla has shown it is only too willing to shift prices to suit demand, leading US analysts to suggest a price cut could be on the way.

Currently, Australia's cheapest Model 3, the rear-drive model, lists at $61,900. (Image: Tom White)

"The tax credit will end for Model 3 Rear-Wheel Drive and Model 3 Long Range on Dec 31, 2023 based on current view of IRA (Inflation Reduction Act guidance," Tesla said on its US website.

The other thing putting downward pressure on Tesla pricing is the arrival of the BYD Seal, with the Chinese brand delivering the first example of its Model 3 rival in Australia this month.

The all-new BYD Seal is the company’s third model in the Australian market and has been billed as its first “luxury sports vehicle”.

Tesla price fluctuations tend to go global, suggesting the Model 3 could be cheaper in Australia in 2024.

There are three variants of the Seal - Dynamic, Premium and Performance - each with different driving ranges and performance capabilities.

The Dynamic is the entry-level model in the range and will be priced from $49,888 (plus on-road costs), the Premium starts at $58,798 and the Performance AWD will cost $68,748. All of which undercut their Tesla equal substantially.

Will US headwinds force Tesla's hand in the wake of new Chinese competition? Watch this space.