The price cuts will make the Model Y, the best-selling electric vehicle in the U.S., eligible for the tax credit of $7,500, making it more competitive.
Tesla has cut the price of some of its most popular electric cars by thousands of pounds in Europe and the US, in a bid to boost customer demand.
New UK buyers will save £5,500 on an entry-level Model 3 and £7,000 on the cheapest Model Y.
Last week Tesla revealed its Q4 2022 production and delivery numbers. It built 439,701 vehicles globally, but only delivered 405,278.