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Tesla stock slid more than 4% on October 7, 2025. The news came after the automaker introduced refreshed ‘standard’ versions of its Model 3 sedan and Model Y SUV priced at around $40,000 or less. The move comes as Tesla aims to offset the recent loss of a federal EV tax credit that had previously offered buyers up to $7,500 per vehicle.
The updated entry-level models are roughly $5,000 cheaper than earlier base versions, but analysts remain unconvinced that the modest price cuts will significantly lift demand. Many on Wall Street had expected Elon Musk to unveil entirely new models instead of updated versions of existing ones.
“Investors were hoping for something more exciting, like the long-awaited Roadster,” said Garrett Nelson of CFRA Research, calling the announcement ‘a disappointment.’ Analysts such as Dan Ives of Wedbush Securities also described the move as underwhelming. It also noted that Tesla’s current lineup has grown ‘stale’ amid intensifying competition in the EV market.
In states offering additional incentives, such as New York, the effective price could drop further, potentially as low as $34,900 after a $2,000 state tax credit. However, final costs, including taxes and fees, are estimated at $42,068.
Recently, Tesla stock gained when Elon Musk became the first person ever to surpass the $500 billion net worth barrier, topping the billionaire list. Musk’s wealth is closely tied to Tesla, where he holds over 12% of the shares. Following a bumpy start to 2025, Tesla stock has recovered, returning 14% year-to-date. The latest boost occurred on October 1, when Tesla stock gained 3.3% in one day, adding a whopping $6 billion to Elon Musk’s net fortune.
So, Tesla stock dip has been attributed to Musk’s renewed interest in his companies, resulting in positive long-term growth prospects for the company. Despite Tesla share pricing adjustments, investor sentiment suggests that deeper innovation may be what the company needs to reignite its sales momentum.
Also Read: Tesla Stock Jumps 7% as Elon Musk Buys $1 Billion in Shares
