Tesla halts online sales of $35,000 Model 3 weeks after launching it

Customers can also lease a Tesla for the first time - but they won't be able to buy it once the lease is up

Tesla has removed its entry-level $35,000 Model 3 from online sale just weeks after launch. Chief executive Elon Musk has long touted the standard Model 3 as a watershed for the electric car industry that will bring the technology to the mass market.

But the company has struggled to figure out a way to sell it at that price and actually makes a profit.

Customers who want the $35,000 Model 3 cans till get one but they will have to go into a Tesla showroom or make the purchase over the phone.

The latest announcement is the fourth round of changes to Tesla’s pricing and retail strategy, which has appeared increasingly erratic.

Mr Musk’s company had said it would shut almost all of its showrooms to focus on online sales before an about turn just 10 days later in which it said most locations would stay open but prices would rise.

Now the focus has switched again. As part of the changes,customers will be able to lease a Tesla for the first time but with a big caveat: they don’t get the option of buying the car once their lease is up.

Why? Because Tesla wants to use them in its planned ride-hailing network which it hopes will take on the likes of Uber and Lyft.

All Tesla vehicles now come with the Autopilot driver-assistance system as standard, the company said in a blog post.

The Model 3 with Standard Plus battery range used to cost $37,500, plus $3,000 for Autopilot. It now costs $39,500 with Autopilot included.

The company launched its long-awaited $35,000 version of the car in February to great fanfare. Now the least expensive version available to order online is the Standard Range Plus Model 3 at $39,000.

Last week, Tesla reported its biggest ever drop in vehicle sales. The electric car maker revealed the first quarter of 2019 saw 31 per cent less deliveries than the previous quarter, representing a fall of nearly 30,000 vehicles.

It is the first time in nearly two years that Tesla has experienced a quarter-to-quarter sales decline but still represents a significant increase from the first quarter of 2018.

Tesla's Model 3 proved to be the firm's most popular car in the first three months of the year Tesla, representing 50,900 sales. The remainder of sales were made up of Model S sedans and Model X SUVs.