Tesla launches a more affordable AWD Model Y

Tesla continues to lower the barrier to entry for its electric vehicles by rolling out more budget-friendly versions. After recently unveiling a $29,000 Model 3 in South Korea, the company has now introduced a cheaper all-wheel-drive variant of the Model Y in the US.

Across global markets, Tesla currently offers seven different Model Y trims. Following the launch of the rear-wheel-drive Model Y Long Range in Europe, the automaker debuted a short-range Model Y AWD in the US. At the same time, Tesla renamed the Model Y Standard trim to Model Y RWD to avoid the stigma of it being “cheap.”

That leaves five Model Y trims available in the US, priced between $39,990 and $57,490. This broad lineup helps fill the gap left by the discontinuation of Model S and Model X variants in the American market.

Here’s the pricing and range breakdown for the 2026 Model Y trims in the US:

Model Y RWD – $39,990, 321 miles of range
Model Y AWD – $41,990, 294 miles of range
Model Y Premium RWD – $44,990, 357 miles of range
Model Y Premium AWD – $48,990, 327 miles of range
Model Y Performance – $57,490, 306 miles of range

The new Model Y AWD is basically the base rear-wheel-drive version with a second electric motor added, using the same battery capacity. Because of this, it delivers the shortest range among all US Model Y trims and is Tesla’s only vehicle in the country with less than 300 miles of range.

Priced $7,000 less than the Premium AWD, the introduction of the new Model Y AWD makes sense-especially since the base rear-wheel-drive model wasn’t selling strongly, prompting Tesla to rethink its entry-level offerings.

Buyers of the more affordable AWD trim will miss out on several features: ventilated and power-adjustable leather seats, the lighted front console, panoramic glass roof, HEPA air filter, matrix LED headlights, acoustic glass, and premium audio system. The paint color options are also more limited. However, with just a 30-mile difference in range, the lack of some design and comfort features might not be a dealbreaker for those looking to save $7,000 while stepping up to an AWD Tesla.