Tesla, which by many is considered a luxury automaker, now sells one of the cheapest electric vehicles in Canada.

The automaker has slashed the price of its Model 3 compact sedan, making it compete with the likes of the Kia EV4, Fiat 500e and Chevrolet Bolt in terms of price.

Tesla just slashed the price of a 2026 Model 3 Premium to a new manufacturer’s suggested retail price of $39,490. With additional fees included, the starting price comes to $42,132.

Only the Kia EV4 has a lower MSRP and only barely.

Tesla was able to lower the price of its Model 3 in Canada after Canada began permitting the import of up to 49,000 Chinese-made EVs per year at a tariff rate of 6.1 per cent. Previously, the tariffs amounted to 106.1 per cent. Vehicles imported beyond the quota of 49,000 annual imports are also hit with the 106.1 per cent rate.

What is the Model 3 Premium?

The Premium model features a single-motor rear-wheel-drive powertrain, which has an estimated 463-kilometre driving range.

The top speed is 201 km/h and zero to 100 km/h arrives in 4.2 seconds, according to Tesla.

Full self-driving (supervised) is available at a monthly cost of $99.

The car comes standard with a black interior and has an optional black-and-white interior at additional cost.

Full model details are available on the Tesla website.

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