Oct 5 Reuters Tesla has cut prices of its Model 3 compact sedan and Model Y SUV in the U.S. by about 2.7 to 4.2 to stoke demand for its electric vehicles, days after the automaker fell short of thirdquarter deliveries estimates.

The Elon Muskled company39;s shares, which have more than doubled so far this year, fell 1.5 in trading before the bell as investors worried that the price cuts could further hit margins, already hovering near fouryear lows.

Data firm Visible Alpha expects Tesla to post automotive gross margins of 19.1 in the third quarter when the company reports results on Oct. 18.

Tesla posted a record high margin of 32.9 in the first quarter of 2022, but those have steadily fallen since.

The Model 3 sedan is cheaper by 1,250 to 38,990, while prices of the Model Y longrange variant were cut by 2,000 to 48,490, the car company39;s website showed on Thursday.

Prices for the standard Model 3 have come down by about 17 since the beginning of the year while the Model Y longrange variant has seen a drop of over 26.

The price drops for the Model 3 also come as deliveries of its refreshed and higherpriced standard version is expected to start in the fourth quarter.

The carmaker missed market estimates for thirdquarter deliveries earlier this week after planned upgrades at its factories to roll out the newer version of the Model 3 massmarket sedan forced production halts.

Tesla on Thursday also cut prices for its higherpriced variants of Model Y and Model 3….