Tesla has introduced a Model 3 option with 363 miles of range that will cost less than $35,000 after federal tax credits. The Model 3 Long Range Rear-Wheel-Drive is now on Tesla's configurator with deliveries slated between July and August 2024. 

Performance-wise, it fits between the base model and Long Range AWD option, with a 125 MPH top speed and 0-60 time of 4.9 seconds. The AWD option is a $5,000 upgrade, though, so you're paying a lot for an extra 0.7 seconds of acceleration. For comparison, Hyundai's Ioniq 6 LR has roughly the same range and price, but isn't eligible for the federal EV tax credit. 

The Model 3 Long Range RWD is now Tesla's cheapest EV, if you take the tax credit into account. That's because the base $38,990 Model 3 RWD version uses lithium-iron phosphate (LFP) batteries from CATL in China, so it's ineligible for any federal rebate.

The new model arrives amid a decline in EV battery prices. The price for LFP cell in China dropped over 51 percent to $53 per kWh over the last year, Bloomberg recently reported. That in turn has led to LFP battery packs at $75 per kWh, meaning EVs can be priced the same or less than combustion vehicles in China. Western efforts to match China's battery production will only increase overcapacity and likely keep prices down.

Early this year, Tesla launched its refreshed Model 3 in the US. The new version has some mild styling changes on the exterior, along with new interior materials, ventilated front seats, a 17-speaker audio system option and a new eight-inch rear display.

This article originally appeared on Engadget at https://www.engadget.com/tesla-brings-the-model-3-long-range-rwd-to-the-us-for-42490-120016482.html?src=rss