Here’s Why Tesla Still Sells a 94-Mile Model 3 Without Autopilot in Canada
Tesla's road to cheaper Canadian EVs is through a low-range Model 3 that Americans can't buy.
Tesla is very protective about the claimed range in its battery-powered vehicles. The automaker has worked hard to establish a name for itself in the market as the king of EVs, even going as far as axing the possibility of a base-trim Model Y because its range would be "unacceptably low" for the price.
The same can't be said for a previously off-the-menu Model 3 available to Canadian buyers that only has 94 miles of range. A configuration that ignores its CEO's criticism of low range in order to sell cars on the technicality of meeting purchase price limitations and eligibility for consumer tax incentives.
Since the very beginning, Tesla has said that the Model 3 was to begin at $35,000. And while that car was available for a short time, albeit also off-the-menu, Tesla ultimately decided to axe the trim altogether. When accounting for currency exchange, that magic number also happens to be the purchase price limit of Canada's Incentives for Zero-Emission Vehicles (iZEV) program, the Federal incentive for zero-emission vehicles in the country.
The program itself works in a similar manner to the tax incentives available in the United States, except that instead of a $7,500 tax credit, a $5,000 ($3,980 USD) point-of-sale incentive is applied to the purchase price of eligible vehicles.
In the case of vehicles with six or fewer seats, like the Model 3, the MSRP of the base-trim model cannot be higher than $45,000 ($35,821 USD). When this condition is met, more optioned-out trims are eligible, so as long as the MSRP remains under $55,000 ($43,767 USD).
Since 2019, Tesla has been quietly selling an off-the-menu Model 3 with a software-locked battery pack in order to thwart limits placed on EV incentives for Canadian buyers.
However, in 2021, Tesla is being a little less quiet about this. When purchasing a Standard Range Plus Model 3 at $52,990 ($42,159 USD), buyers have the option to limit their new Model 3 to just 151 kilometers of range, or 94 miles. This removes basic Autopilot as well, turning it into an available $4,000 ($3,186 USD) upgrade, and brings the purchase price of the vehicle down to $45,999. Tesla's website lists the price as $46,389, however, that includes destination and other fees that aren't taken into account when determining iZEV eligibility.
And because this model was technically available, consumers buying any trim under the upper $55,000 limit would be eligible for the iZEV incentive, including the Standard Range Plus with 263 miles of range. The Long Range and Performance variants remain ineligible due to being over the $55,000 limit.
Let's be clear once again that Tesla deems it perfectly acceptable to offer a Model 3 with 94 miles of range in Canada, but 250 miles for the Model Y is too low for the bordering country of the United States where the vehicle is produced. It's also worth noting that the U.S. doesn't determine eligibility for its EV tax credit based on MSRP, and even if it did, it wouldn't matter to Tesla since buying one no longer qualifies a consumer for these incentives anyway.
It's not clear how many of these 94-mile Model 3s have been sold, but it seems pretty silly to forego some of the main selling points of a Tesla in order to save a few grand off the purchase price, especially when the Federal incentive available to the Standard Range Plus puts the cost within $2,000 of the 94-mile's MSRP.
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