Tesla launches new Model Y AWD in U.S. at $41,990
Tesla has launched a new all-wheel-drive (AWD) version of its best-selling Model Y SUV in the United States, with a starting price of $41,990, according to the company’s website.
The new variant is positioned above the lower-priced rear-wheel-drive “Standard” version and is part of Tesla’s broader strategy to expand its lineup of more affordable electric vehicles, News.Az reports, citing Reuters.
The launch follows Tesla’s rollout of cheaper “Standard” versions of the Model Y and Model 3 in late 2025. Those models were priced roughly $5,000 below previous base versions and have become central to the company’s strategy to attract more price-sensitive buyers.
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In the U.S., these lower-priced versions help offset the impact of higher effective purchase costs following the end of the $7,500 federal EV tax credit. In other global markets, similar price reductions are aimed at maintaining demand amid intensifying competition.
The move comes as the global electric vehicle market shows signs of cooling, with automakers facing pressure from rising competition and shifting policy incentives.
Analysts say Tesla’s growing focus on lower-priced models could help maintain sales volumes but may also put pressure on profit margins unless the company reduces production costs or increases revenue from software and services.
Separately, CEO Elon Musk recently indicated that Tesla plans to end production of the Model S and Model X sedans, with plans to use production capacity in California for new projects, including humanoid robotics development.
By Aysel Mammadzada
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