Tesla on Tuesday unveiled two lower-priced versions of its electric vehicles in an effort to halt declining sales and market share amid rising competition.

The company launched its best-selling SUV, the Model Y, at $39,990 and its sedan, the Model 3, at $36,990.

Tesla shares fell four percent shortly before Wall Street closed.

Both versions, called the Standard models, can travel 516 kilometers on a single charge but have slower acceleration compared to the current higher-end Premium versions. Tesla’s website showed that both models are available for immediate order, with deliveries expected between December 2025 and January 2026 at many locations.

The Standard versions do not include Tesla’s Autosteer autopilot system or rear passenger touchscreen displays.

Tesla also removed the LED light bar on the cheaper Model Y; both come with cloth seats, with leather seat options available on the Model 3, and manually adjustable side mirrors.

CEO Elon Musk has long promised to offer cars affordable to the masses, despite canceling last year plans to build a completely new $25,000 electric car, which Reuters first reported.

Instead, he chose to produce lower-cost versions based on Tesla’s current models, raising concerns among investors and analysts that cheaper cars could cannibalize sales of existing vehicles and limit growth.

Tesla is already experiencing slowing sales of its older models amid rapidly increasing competition, especially in China and Europe, where Musk’s far-right political views have undermined brand loyalty.

Earlier this year, Tesla launched an updated version of the Model Y with improvements including new light bars and a rear touchscreen.

Tesla said it will launch more affordable vehicles within its lineup but gave no details.

Sources told Reuters that the electric car maker also plans to release a simplified version of its mid-size sedan, the Model 3.

Affordable cars will also be a key factor in Tesla’s goal to deliver 20 million vehicles over the next decade, one of many operational and valuation milestones set by the company’s board in Musk’s proposed $1 trillion compensation package.