AUSTIN, Texas — Tesla's two highest-volume vehicles just landed on California's newest incentive list. Under MyFirstEV, the $270 million rebate program Governor Gavin Newsom signed into law on July 13, both the Model 3 and the Model Y qualify for a $3,500 discount applied directly at the point of sale for first-time electric-vehicle buyers.
The program is designed to fill the gap left when the $7,500 federal EV tax credit expired, and it targets exactly the buyers Tesla wants most: newcomers to electric driving in the single largest EV market in the country. California accounts for roughly a third of all EVs sold nationally, which makes qualifying models an outsized prize.
How the rebate works
First-time buyers can take $3,500 off any new battery-electric vehicle with an MSRP up to $50,000, with a separate $1,750 rebate for used EVs priced under $25,000. Crucially, the money is applied at the dealership rather than deferred to tax season, removing the friction that blunted the old federal system. The California Air Resources Board is expected to publish full participation details next month, with the program going live later this summer.
For Tesla shoppers, the math is favorable across the lineup's volume sellers. The Model 3 Rear-Wheel Drive at $42,490 and the Long Range at $47,490 both slot under the cap, and the Model Y — starting at $44,990 after Tesla's recent price adjustment — qualifies as well. That is significant because the Model Y and Model 3 already drive the overwhelming majority of Tesla's U.S. sales, a dominance underscored when Tesla captured half the U.S. EV market in the first half of 2026.
