Tesla slashes lease pricing on Model 3/Y, expects to lose half tax credit on 3
Hot on the heels of a price drop that makes the Model 3 the cheapest Tesla yet, Tesla has also cut the base lease pricing for Model 3 and Y by $90/month and $100/month respectively.
But the company also now says that it “expects” to lose access to half of the US $7,500 federal tax credit at year’s end, reducing that credit down to $3,750.
Tesla has continued to cut its prices throughout this year, with Model 3 getting another $1,250-$2,250 cut just last week and Model Y LR and Performance trims getting a $2K price cut.
But those price cuts throughout the year didn’t really manifest in lease pricing. Tesla has never really focused on leasing, and lease prices have always been a bit higher on a Tesla than on similarly priced EVs. Last quarter, for example, only about 5% of Tesla’s sales were leased, which is far below the industry average.
But that might be changing with a significant price cut today for Tesla’s leased vehicles.
Last week, Tesla quoted a monthly payment of $419/month for the Model 3 and $499/month for the Model Y on each base model. But today we’re seeing payments of $329/month and $399/month respectively, with the same down payment ($4,500), term (36 months), and mileage (10k/yr) as the previous prices were quoted.
Other trims have seen similar reductions of $70-$90/month off.
Tesla has now placed leasing front-and-center on the Model 3 and Model Y order pages, with the right side of the screen featuring purchase price (or Tesla’s misleading “probable savings” price), and the bottom portion quoting lease pricing, where it used to simply show the purchase price again. It is also easier to access a calculator for leasing/financing options by clicking on that bottom portion.
While Tesla’s website doesn’t state this openly, this price drop could have something to do with the way the EV tax credit works, which allows almost all of its restrictions to be bypassed by leasing vehicles. Most companies have taken advantage of this and are now passing along these lease savings to customers, but Tesla never did.
Again, we don’t know if it’s starting to do this now and passing the savings along, or if it’s still keeping those credits for itself and this lease price reduction is just reflective of the falling prices of Tesla vehicles anyway.
Tesla ‘expects’ to lose half of US tax credit on Model 3
But now it also looks like Tesla expects prices to increase at the end of the year – well, effective prices anyway, given that it now “expects” that half of the tax credit is going away for the Model 3.
The reason for this is that the Inflation Reduction Act tax credits are limited to cars with battery components and raw materials that come from the US or from a free trade partner. The restriction gets stricter each year, and it looks like Tesla thinks it won’t qualify for half of the credit with next year’s tightening of restrictions.
Tesla’s Shanghai factory has been producing Model 3s and components for Model 3s for quite some time now, having produced its 2 millionth EV last month. Some of those components include LFP batteries that make their way into Tesla’s base model vehicles and are made in China, which could be the reason for the reduction.
Before today, Tesla’s website stated on the Model 3’s order page that “reductions are likely after Dec 31.” Other models had seen the same warning at times, but currently the Model Y does not have that warning, rather saying, “Take delivery by Dec 31 for full $7,500 tax credit.”
But today Tesla has changed that warning to say: “$7,500 tax credit expected to reduce to $3,750 on Dec 31 pending federal guidance. Take delivery to guarantee full incentive.”
That said, Tesla has had a confusing history with this portion of the tax credit in the past. At first, the base Model 3 did not qualify for the full $7,500 tax credit upon the IRS’s release of battery guidance, though only a month and a half afterward, Tesla surprised by gaining access to the full credit on the base Model 3. Soon after that, it added the “reductions likely” language to its website, which it has now upgraded to “expected” for the Model 3.
Other models no longer say “reductions likely” – Model Y states, “Take delivery by Dec 31 for full $7,500 tax credit,” but doesn’t include similar language about reductions being likely or expected.
All this talk about tax credits is complicated and may not apply to every buyer, since every buyer can’t necessarily take advantage of the full credit due to the current credit being nonrefundable. But that too is changing on January 1, 2024, when the tax credit will be available upfront at the point of sale, and will then allow lower-income buyers to gain the full credit even if they don’t have enough tax liability to do so, as the IRS confirmed last week.
This might otherwise be a boon for some trying to take advantage of Tesla’s new lower prices, but with this “expected” halving of the tax credit on Tesla’s cheapest model, that news is somewhat bittersweet.
Electrek’s Take
That said, there’s always the chance that this language is just a play by Tesla to sell more cars. There are two potential reasons one might think this: First, Tesla just had a disappointing quarter and may be looking to boost sales. It seemed to know ahead of time that that quarter might be disappointing, too, given its craven limited-time FSD transfer scheme, which seemed targeted solely at boosting sales, rather than doing what’s right for customers who purchased a system several years ago that still doesn’t do what Tesla said it would do.
Second, Tesla just released the highly anticipated Model 3 Highland refresh in Europe, but that isn’t expected to come to the US until early next year. This could mean some buyers want to delay and purchase the new Model 3 with all the new features, but may be lured into buying early with Tesla dangling price drops and potential loss of tax credits in front of them.
Just like when Tesla originally added the “reductions likely” language, which we called “self-serving,” the vagueness of exactly why these credits were gained in the first place, and why they might be lost, makes it difficult to understand what the reason for the credit reduction is, and whether Tesla might just be yanking our chain. A little clarity on this would be nice from Tesla’s, uh… PR department…
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After cutting prices on its top-selling electric vehicle by nearly $10,000 in the US, Hyundai is now bringing the savings to new markets. Hyundai is offering discounts of over $34,000 on some of its EVs overseas.
Hyundai is discounting EVs in the US and overseas
Last week, Hyundai announced it was reducing prices on the 2026 IONIQ 5 by up to $9,800 in the US. The 2026 IONIQ 5 starts at just $35,000, making it one of the most affordable EVs available alongside the Chevy Equinox EV and the Nissan LEAF.
Hyundai said the generous EV discounts reflected its “commitment to affordability” as part of its long-term strategy.
Record vehicle sales and higher output at its new EV plant in Georgia are helping reduce costs, which the company said it’s now passing on to buyers.
The massive EV discounts are starting to pile up after Hyundai cut prices in another market on Tuesday. After launching a series of special offers in Australia on Tuesday, Hyundai is discounting some of its EVs by more than $34,000.
According to TheDriven, Hyundai reduced prices on select IONIQ 5, IONIQ 6, Inster EV, and Kona Electric models by up to $34,142.
Hyundai’s most affordable electric car, the Inster (which is sadly not sold in the US), received a $3,925 price reduction, and now starts at under $40,000 for the first time.
The IONIQ 6 is heavily discounted, with up to $34,142 off the driveway price on 2023 model year inventory. Hyundai has also reduced the prices of the IONIQ 5 by nearly $10,000. As the report points out, the savings are based on the driveway prices in NSW, which are available nationally.
Although Hyundai’s price cuts in the US were in response to the $7,500 federal EV tax credit expiring, the discounts in Australia come as demand for electric cars is at an all-time high. In September, electric vehicles accounted for 11.3% of new car sales.
In the US, Hyundai is still offering a $7,500 cash incentive for 2025 IONIQ 5 models until at least the end of October.
| 2025 Hyundai IONIQ 5 Trim | Driving Range (miles) | 2025 Starting Price | 2026 Starting Price* | Price Reduction | Monthly lease cost (October 2025) |
| IONIQ 5 SE RWD Standard Range | 245 | $42,600 | $35,000 | ($7,600) | $249 |
| IONIQ 5 SE RWD | 318 | $46,650 | $37,500 | ($9,150) | $259 |
| IONIQ 5 SEL RWD | 318 | $49,600 | $39,800 | ($9,800) | $299 |
| IONIQ 5 Limited RWD | 318 | $54,300 | $45,075 | ($9,225) | $369 |
| IONIQ 5 SE Dual Motor AWD | 290 | $50,150 | $41,000 | ($9,150) | $309 |
| IONIQ 5 SEL Dual Motor AWD | 290 | $53,100 | $43,300 | ($9,800) | $349 |
| IONIQ 5 XRT Dual Motor AWD | 259 | $55,500 | $46,275 | ($9,225) | $379 |
| IONIQ 5 Limited Dual Motor AWD | 269 | $58,200 | $48,975 | ($9,225) | $419 |
The 2025 Hyundai IONIQ 5 Standard Range starts at $42,600, while the 2026 model year is priced from just $35,000.
Although it was already one of the most affordable EVs on the market, the IONIQ 5 is hard to pass up with leases starting at just $249 per month in the US. For $10 more per month ($259), you can upgrade to the long-range SE RWD trim, which offers a range of up to 318 miles.
Curious what Hyundai’s electric SUV feels like to drive? You can find available IONIQ 5 models near you through our trusted partner.
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Northern Illinois utility ComEd has spent for than $100 million in EV and EV charging rebates since launch its Beneficial Electrification program in 2024 — an investment that, along with funding from the Illinois EPA and other Federal grants, has helped drive EV adoption in the state at a rate that’s rapidly outpaced the rest of the nation.
Since its launch in 2024, ComEd’s Beneficial Electrification (BE) Plan has supported the deployment of more than 7,200 electric vehicle charging ports and over 2,200 EVs registered to business and public sector commercial customers.
The company, part of the larger Exelon utility group) has also announced plans to invest an additional $168 million of EV and charging infrastructure investments between 2026 and ’28. The target is both in line with Illinois’ clean transportation goals and which will generate a real, objective reduction in air pollution — a goal that (one would hope) transcends political affiliations.
“Reducing emissions from vehicles is one of the most effective and important things we can do to improve air quality and public health,” explains Rob Anderson, President and CEO of Respiratory Health Association. “As we have seen the ending of federal funding support for this effort, ComEd’s continued commitment of transportation electrification rebates is leading the way for our shared goal of eliminating pollution and creating cleaner air for all of our communities across northern Illinois.”
Building on the $231 million investment from 2023 through 2025, the additional $168 million will assist both residential and non-residential customers transition to EVs. The company also places an emphasis on equity, with 80% of the rebates from its over 6,400 projects going to low-income business and public sector organizations serving low-income and Equity Investment Eligible Communities (EIECs).
The ComEd rebates support the goals of Illinois’ Climate and Equitable Jobs Act (CEJA), which was signed into law by Governor J.B. Pritzker in 2021 to combat climate change and promote beneficial electrification across the state. CEJA also has the goal of putting 1 million EVs on Illinois roads by 2030, and ComEd certainly has role to play there, as 90% of the 150,000 EVs registered in Illinois operate within its service territory (that’s up from 19,000 EVs in 2019).
Electrek’s Take
While President Trump was running for re-election, he campaigned on the threat promise of canceling the $7,500 federal tax credit for EVs — a campaign promise he kept as recently as September 30th. That wasn’t the end of the road for EVs, however.
Along with California Governor Gavin Newsom, Illinois’ Governor JB Pritzker made countermoves – launching a $4,000 rebate for new electric cars and up to $1,500 for the purchase of a new electric motorcycle. More recently, some clever accounting from the folks at GM and Ford are keeping the $7,500 lease credit alive, and other companies like Hyundai and Toyota are simply reducing the asking price on their EVs.
It seems to me like there’s plenty of life in EVs, yet.
SOURCE | IMAGES: ComEd; via LinkedIn.
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Environment
Prime Day Green Deals hub – EVs, power stations, electric tools, eco-friendly appliances, more
Amazon’s Prime Big Deal Days event has officially kicked off and will be running through October 8 with some of the best deals of the year on eco-friendly tech. We’ve got another large collection of Green Deals during this two-day period, which we’ve collected the best of and curated into this one-stop shopping hub that will continue to be updated through the week. You’ll find the best of these ongoing seasonal deals on power stations/solar generators, EVs of various kinds, electric tools, and other eco-friendly appliances and smart devices.
October Prime Big Deal Days 2025 Green Deals
Prime Day Power Station Green Deals
- EcoFlow’s Prime Day Sale increases power station discounts up to 65% with bonus savings, free gifts, and more from $169
- EcoFlow launches new DELTA 3 Max and Ultra power stations with up to $2,000 in savings + FREE gear starting from $759
- Save up to 65% on power stations during Anker’s SOLIX Prime Day Sale with extra savings, free gifts, and more from $299
- Prime Day offers another chance to pick up the Anker PowerCore Reserve 60,000mAh station at $80 (Reg. $150)
- Jackery’s Prime Day sale drops Explorer 1000 v2 with 200W panel to $649 (50% off) + free bundle offer, more from $129
- Score $1,600 in exclusive savings on Jackery’s Explorer 3000 v2 (HomePower 3000) LiFePO4 station at a new $899 low
- Jackery launches its new compact Explorer 240D 256Wh power station at Amazon with first savings from $139 (Reg. $209)
- Bluetti takes up to 63% off power stations and bundles in its Prime Day Sale + select exclusive savings – all from $329
- Power your mobile life through Bluetti’s new RVSolar power system bundles with exclusive savings from $2,519 (Reg. $3,699+)
- Autel’s new Home 3000 portable 3,072Wh LiFePO4 power station with an AI voice assistant hits a new $1,659 low ($400 off)
- UGREEN’s 5-port Nexode 48,000mAh power station with 300W charging speeds returns to $102 (Reg. up to $170), more
Prime Day EV Green Deals
- Letric Better-Than-Prime Sale with up to $694 in FREE gear on models from $999
- Rad Power’s Haul-o-ween Sale offers up to $210 in FREE cargo or starter gear with new and legacy e-bikes starting from $1,399
- Segway’s new E3 Pro electric scooter with dual suspension, regen brakes, Apple Find My, and 34-mile range launches at $600 (Reg. $700)
- Save $500 on Aventon e-bikes, with the all-terrain Aventure 2 back at its $1,499 annual low (Reg. $1,999), more
- Heybike’s Prime Fall Sale drops the ALPHA all-terrain mid-drive e-bike to a new $1,399 low (Save $300), more from $899
- Heybike’s Hauler cargo e-bike with a 440-pound carrying capacity and multi-battery options hits new lows from $899
- Heybike’s premium Hero carbon fiber mid-drive and rear hub all-terrain e-bikes at new lows from $2,099
- Navee’s Autumn Sale increases EV savings for Prime Day, with its flagship ST3 Pro dropping to $710 (Reg. $950), more
- Get up to 50A charging speeds with Autel’s MaxiCharger AC Lite level 2 EV station at $455 (Reg. $569)
- Bring home Autel’s 40A MaxiCharger AC Lite level 2 EV charging station with an AI voice assistant for $379 (Reg. $470)
- Velotric’s Prime Fall Sale offers up to $670 savings and select FREE gear on e-bikes starting from $1,299
- Hiboy launches new EX9 urban commuter e-bike with dual-sided torque sensors and 62-mile range at $1,200 (Reg. $2,000)
- EcoFlow’s PowerPulse level 2 40A EV charger integrates with home backup setups at a $699 low (Reg. $899), bundles from $2,199
- Get a charge anywhere with Schumacher’s latest 12A level 1 portable EV charger at $128 (Reg. $160)
Prime Day Garden and Lawn Care Green Deals
Prime Day Appliance and Device Green Deals
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