Electric car producer Tesla raised its prices this week amid spiking supply costs and high inflation rates.
Tesla’s website showed the company’s Model Y Long Range price tag was $65,990, up from $62,990. Model S vehicles were up to $109,490 from $104,490.
The increase in prices comes during a period of record-setting inflation and as the costs of raw materials to produce the vehicles have risen. Products like aluminum and lithium, which is part of the cars’ batteries, have all shot up in price, according to Reuters.
“Price of lithium has gone to insane levels! Tesla might actually have to get into the mining & refining directly at scale, unless costs improve,” Tesla CEO Elon Musk said in a tweet earlier this year.
“There is no shortage of the element itself, as lithium is almost everywhere on Earth, but pace of extraction/refinement is slow,” he added.
Earlier this year, Tesla raised the prices of its vehicles twice in one week, increasing all of its U.S. models by between 5 and 10 percent and increasing models made in China by 5 percent.
“Tesla & SpaceX are seeing significant recent inflation pressure in raw materials & logistics,” Musk tweeted at the time. “And we are not alone.”
Also at that time, reports indicated that Tesla bought millions of euros worth of aluminum from Russian company Rusal amid concerns over how Russia’s invasion of Ukraine could impact the supply chain.
The company had not been sanctioned at the time of that purchase, but Rusal has said how Western sanctions amid Moscow’s invasion of Ukraine could cause potential “difficulties in supply of equipment, which may lead to the postponement of investment projects,” Reuters noted.