Tesla cuts prices of electric vehicles: Model 3, Model X, Model S will be cheaper

Tesla is cutting the starting price of its U.S. electric vehicles by $2,000 and bolstering other incentives as it continues to expand production.

The price cut comes after the $7,500 federal tax credit for electric vehicles was slashed in half at the end of 2018.

Concerned investors drove Tesla shares down more than 10 percent in early trading Wednesday morning to $299.10.

The price cut reflects Tesla's bid to gain greater market share of the automotive market.

The Model 3 sedan, which is Tesla's first mass-market vehicle, now carries a starting price of $35,950, although that model has not yet been manufactured. The base model will have rear-wheel drive and 260 miles of battery range. Other versions include the all-wheel-drive Performance model, which starts at $53,950 and includes 310 miles of range.

CEO Elon Musk has promised the base model will be available early this year, but the company has so far focused on manufacturing more expensive versions of the Model 3.

The Model S large luxury sedan starts at $66,750, and the Model X luxury SUV starts at $72,950.

The company announced Wednesday that it made 86,555 vehicles in the fourth quarter, up 8 percent from the third quarter. That included 61,394 units of the Model 3.

Tesla sold 90,700 vehicles during the period, up 8 percent from the previous quarter. That included 63,150 Model 3 cars.

Tesla will begin selling the Model 3 in Europe and China in February, a significant milestone as the company continues its global expansion.

Follow USA TODAY reporter Nathan Bomey on Twitter @NathanBomey.

This article originally appeared on USA TODAY: Tesla cuts prices of electric vehicles: Model 3, Model X, Model S will be cheaper