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Tesla Has Some Very Bad News for EV Buyers – TheStreet


Russia's invasion of Ukraine has caused crude-oil prices to spike. That surge in turn has boosted the costs of raw materials, creating a headache for many industries, including automotive. 
Since Russia invaded Ukraine on Feb. 24, oil prices have jumped more than 30%, touching $139 a barrel at one point this week. The oil price on Wednesday had fallen back to about $106, but by Thursday morning it was trading at around $116.
As for other raw materials, aluminum and nickel prices have surged on speculation that a war and western sanctions could cut off Russian exports.
Russia is responsible for 6% of global aluminum supply and 7% of mined nickel, Reuters reports. So a war and sanctions could wreak havoc on global supplies of the metals.
The impact will be significant on the price of vehicles, especially electric ones because nickel is a key component of the batteries.
"Did you see nickel futures today?" Morgan Stanley analyst Adam Jonas wrote in a  research note released Monday. "As of this writing, nickel is up 67.2% just today, representing around a $1,000 increase in the input cost of an average EV in the US."
In other words, the prices of electric vehicles could be expected to increase. Well, it didn't take long: Tesla, the market leader, has just increased the prices of certain models.
"Alternative sources for nickel mining (Canada, Australia,etc) would take years and countless regulatory hurdles to build out," Jonas said.
The manufacturer of high-end electric vehicles has updated its prices, in particular for the Model 3 sedan and Model Y SUV.  Prices have increased by $1,000 depending on vehicle configurations.
So it gives this:
Model 3 RWD,  267 mile range- $44,990 (No Change)
Model 3 Long Range, 334 mile range – $51,990 (+$1,000)
Model 3 Performance, 315 mile range – $58,990 (No Change)
Model Y Long Range, 318 mile range – $59,990 (+$1,000)
Model Y Performance, 303 mile range – $64,990 (+$1,000)
Tesla does not say whether these price increases will apply to old orders or only to new ones. 
The company, which has had no press department since last year, didn't respond to a request for comment.
Tesla most recently raised prices last November. 
The new price increase is also accompanied by a postponement of deliveries of certain vehicles. The Model Y Performance due in April will now be delivered in May, and the Long Range is now due in September instead of August.
This inevitable price hike seemed to be accepted by Tesla fans in view of the reactions on social media.
"That’s not horrible considering the price increase of everything," posted one user.
"I think it’s reasonable to expect more prices increases," added Sawyer Merritt, a self-described Tesla investor.
Other users, however, argued that the cars were getting out of reach.
"This practically could mean it’s now, as a $60k vehicle, is out of reach to most," another used wrote.
"This is getting ridiculous. In other words, now $1000/month car payment. Well, $954/month to be exact for the cheapest one. Without FSD or any options. I keep working harder to afford one and it keeps staying just out of reach," posted a frustrated user.
Rivian  (RIVN) – Get Rivian Automotive, Inc. Class A Report, one of Tesla's young rivals, recently saw a cascade of cancellations after raising its prices. CEO RJ Scaringe apologized publicly and said that the bond of trust with customers had been betrayed. The company abandoned these new prices immediately for orders already registered.
"While this was the logic, it was wrong and we broke your trust in Rivian," Scaringe wrote, referring to the price increase.


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