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Tuesday, 15 March 2022 18:42

Tesla hikes car prices after Elon Musk issues inflation warning.

Staff Reporter.

Tesla Inc raised prices on all its vehicles after chief executive officer Elon Musk said costs were increasing at the companies he runs.

The cheapest Model 3 in the US is now $46,990, according to Tesla's website. The company raised prices by 3% to 5% in both the US and China, Dan Levy, a Credit Suisse analyst, said in a note to clients.

Musk tweeted earlier this week that both Tesla and Space Exploration Technologies Corp were seeing "significant" inflation in raw materials and logistics. The electric car and rocket-making companies aren’t alone.

The S&P GSCI Index – a commodity market benchmark – surged 20% the first five days of the month, the biggest weekly gain going back to 1970.

This is Tesla’s second round of price increases in the last week. The company raised the price of certain versions of the Model 3 and Y on March 9 in the US, followed by an increase for China-built vehicles in that market on March 10.

Tesla shares fell as much as 1.3% to $756.57 as of 9:50 a.m. Tuesday in New York. The stock has dropped 28% this year.