TSLA Tesla Inc

Tesla Motors Inc. will restart sales of a lower-range version of the Model S sedan less than a year after discontinuing it, a move that cuts the price of the luxury electric car well ahead of the introduction of a cheaper Tesla slated for 2017.

Tesla on Thursday will begin selling a 60-kilowatt-hour version of the Model S that will get more than 200 miles of range and base price of $66,000. The Silicon Valley auto maker less than a year ago discontinued the 60 kwh version of the Model S to make way for a pricier 70 kwh model as the base version of the sedan.

The car will be built with a 75 kwh battery—but that will be limited to a lower range. If a buyer chooses, they can later unlock the additional range with a software upgrade for a price that is yet to be disclosed.

Originally, the 60 kwh version was a very small percentage of Tesla's sales of the vehicle.

Tesla said it is making the move to give people who are interested in the brand but can't afford the longer-range versions of the Model S, which start at $76,500. Buyers, typically spend more than $100,000 on Tesla's vehicles.

The Model 3, which is due out in the second half of 2017, is expected to have more than 200 miles of range and start at $35,000. That vehicle has generated nearly 400,000 reservations from people who put down a $1,000 deposit.

The move comes as the quarter-over-quarter sales of the Model S slowed over the first three months of 2016. The auto maker, which launched its second vehicle late last year—the Model X SUV—sold 12,420 vehicles in the first quarter, an increase over the same period the prior year but down significantly from the 17,000 delivered in the fourth quarter.

Comparisons to the fourth quarter were affected by tax incentives in Denmark that expired at the end of 2015. The pull-ahead of sales in that important market, and likely the impact of filling Model X orders, help explain the disparity.

Still, the move indicates buyers are interested in getting a better deal on a Tesla, even if it means sacrificing power. The lower-cost Model S will have access to the company's fast-charging network for no additional fee and will be offered with an all-wheel-drive version.

Write to Mike Ramsey at michael.ramsey@wsj.com

(END) Dow Jones Newswires

June 09, 2016 09:15 ET (13:15 GMT)

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