Tesla pumps brakes on plan to shutter all stores

Tesla pumps brakes on plan to shutter all stores

Tesla pumps brakes on plan to shutter all stores

At the start of March, Tesla said it would be closing nearly all of its showrooms, and shifting sales to online only.

But Tesla says it has been evaluating that decision over the last two weeks and has decided it would be beneficial to keep some physical stores open.

The abrupt move earlier this month by CEO Elon Musk, contrasting with an expanding network of retail spaces, sparked concern about Tesla's finances. Model 3 last week, company boss Elon Musk said achieving the long-targeted price for the entry-level variant could only be achieved by cost saving from closing a number of its stores and switching to an online-only sales model.

Tesla has 378 stores and service centers worldwide.

According to Tesla's blog, the preference for conducting sales online will continue and said buyers in stores would be trained to order a Tesla on phone, which is a rapid process.

One relief for drivers is that Tesla will not increase the prices of the $35,000 Model 3.

The move made no sense to begin with because Tesla had spent millions fighting in courts and state legislatures trying to change laws that prevented companies from selling vehicles at their own stores, Ramsey said.

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The step backwards will come as a hit to customers as well, as Tesla will raise prices 3% on all S and X vehicles as well as all of the Model 3 configurations other than the $35,000 configuration to account for the remaining stores.

The electric auto maker said in a statement late Sunday that prices for most models worldwide would go up by about 3% after it made a decision to "keep significantly more stores open than previously announced". Pricing will increase by about 3% globally. The dispute arose after Musk tweeted that he was taking the company private at a price of $420 a share, which the SEC considered false and misleading, and looked to sue Musk for securities fraud.

The case is the latest major challenge by authorities to Musk's leadership as Tesla seeks to make good on his promises to Wall Street that it will soon by consistently profitable and will not need more capital. Tesla wants to increase its vehicle transportation capacity and cut delivery times.

The company gave no numbers, but said it would close only about half the stores that it had meant to.

"Potential Tesla owners will have a week to place their order before prices rise, so current prices are valid until March 18", the EV maker said, which could add further confusion for potential buyers.

Tesla's announcement of original plan to close its stores prompted a sell-off in the company's stock.

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