Because of competition from a new electric vehicle maker, Tesla, Inc.'s chief executive Elon Musk says it is cutting prices for the Model S long-range sedan in the U.S.
"The gauntlet has been thrown down! The prophecy will be fulfilled. Model S price changes to $69,420 tonight!" CNBC quoted Musk as saying in a tweet.
Lucid Motors reduced the price for its Air sedan - which now sells at $69,900. Tesla followed suit by cutting the price of its long range to $69,420 from $71,000.
Tesla has experienced declining sales of its sedan as a result of rising competition. Tesla started cutting prices in May with cuts of up to $5,000.
Next year, Daimler AG of Germany will release its Mercedes-Benz S-class luxury sedan electric version. It may be a lot more expensive at $117,500 than Tesla's Model S but it will increase competition even more.
Tesla's Model S long-range performance was recently improved and it now averages 402 miles per charge - the most of all electric cars on sale.
Next year, it plans to release the Model S Plaid high-performance which claims to reach 520 miles a charge. It will sell for $139,990.
Tesla opted to adjust its prices instead of giving rebates or sales discounts.
Tesla expects an increase of worldwide deliveries for its Models. Tesla delivered 15,200 units of its Model S and Model X SUV between January and September from 27,700 units in 2018. However, its strength is in its cheaper Model 3 and Model Y that put Tesla's overall deliveries at 139,300 a quarter.