Tesla cuts price of Model S Long Range Plus, says EPA-rated range improved to 402 miles - CNBC

Tesla confirmed Monday night that it recently cut the price of the 2020 Model S Long Range Plus by $5,000 and boasted that the EPA-rated range for this version of the Model S -- meaning the number of miles the vehicle can travel per single charge in testing conditions -- has increased to 402 miles.

A spokesperson for the Environmental Protection Agency told CNBC in an e-mail on Tuesday:

"EPA can confirm that we approved a 402 mile range for the updated Tesla Model S Long Range Plus. Tesla has updated the 2020 Model S Long Range Plus vehicle making several changes to the vehicle from the one EPA previously tested. EPA approved the new label value based on a review of the testing protocols and data submitted by Tesla and found it was complete and accurate. Fueleconomy.gov will be updated in about a week with this information."

In other words, the EPA approved Tesla's right to advertise a 402-mile range rating for the latest version of the Model S Long Range Plus, but the agency has not conducted its own tests of the vehicle.

In Tesla's blog post on Monday, the company focused on the ways in which it has improved the range of the Model S Long Range Plus as compared to earlier versions of the company's flagship electric sedan.

Among other things, Tesla said it achieved range improvements by reducing the mass of the vehicle by using lighter weight materials in its battery pack and drive units, and other lighter weight components. It also updated its "HOLD" features which allow drivers to remain stopped on a hill without having to keep the brake pedal pressed down. These features maximize regenerative braking in the Model S and other Tesla vehicles that have it.

On Tesla's first-quarter earnings call on April 29, CEO Elon Musk said that the EPA had mishandled prior assessments of Tesla electric vehicles, and that the Model S range was already over 400 miles.

"The real Model S range is 400 miles, but when we did the last EPA test, unfortunately, a TA left the car door open and the keys in the car. So the car -- and they did this overnight. And so, the car actually went into a waiting for driver mode and lost 2% of its range. And as a result, it had a 391 test. As soon as the EPA reopens for testing, we will redo the test, and we're actually confident that we will achieve a 400-mile or greater range with the Model S. But to be clear, the Model S, for the past two months -- the true range of the Model S for the past two months has been 400 miles."

The EPA disputed Musk's story, as The Verge later reported. "We can confirm that EPA tested the vehicle properly, the door was closed, and we are happy to discuss any technical issues with Tesla, as we do routinely with all automakers," a spokesperson told the publication in May.

An EPA-rated range does not reflect the range an electric vehicle may be able to travel in real world driving scenarios or on the track.

For example, the 2020 Porsche Taycan Turbo S scored a 192-mile rating from the EPA, and the 2020 Tesla Model S Performance scored a 348-mile EPA rating. But when Car & Driver tested the vehicles on the same track, in California, on the same night, the cars were much closer together -- the Taycan scored a 209-mile range and the Model S scored a 222-mile range.

The Model S has not been a top seller for Tesla in the last few quarters as the company turned its focus to Model 3 sales in the US, and the start of Model 3 production and deliveries in China.

In the first quarter of 2020, before the harshest health and economic impacts of Covid-19 were felt in the U.S., Tesla reported Model S and Model X vehicles deliveries of 12,200 total. The company produced 15,390 Model S and X vehicles in Q1 2020, or 25% more than it was able to deliver in that quarter. In the preceding fourth quarter of 2019, Tesla delivered 19,450 Model S and X vehicles.

It's not clear whether discounting the Model S Long Range Plus domestically will help Tesla reach its delivery goals for the second quarter, a number analysts expect to hear before the July 4 holiday in the U.S.

Discounting some of its made-in-Shanghai Model 3 vehicles recently helped Tesla resuscitate sales in China, following a Covid-19 related slump in April there.

Correction: This story has been updated to reflect the fact that Tesla's June 2020 blog post was referring to an updated "hold" feature, not a brand new feature.

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