Consumers hoping to own a Tesla electric vehicle were caught by surprise when Elon Musk announced plans to develop a $25,000 model in the future. This along with other innovations were presented during its Battery Day event, which saw company shareholders in attendance inside their vehicles akin to that of a drive-in movie.

Meanwhile, Lucid just revealed that its entry-level emission-free sedan – the Air – will retail for below $80,000 at $77,400. However, with a $7,500 tax credit, it would end up at $69,900. In response, Elon Musk confirmed another price drop for the Model S.

Ahead of the Air's launch, analysts have projected that it would pose a serious competition to Tesla's sedan. Not only is the latter somewhat outdated when it comes to design, it currently does not offer anything new for interested buyers. Its rival Lucid Motors, on the other hand, sports a sleek and dynamic aesthetic that noticeably looks fresh. Moreover, it boasts a remarkable 406-mile range (517 miles on a more premium trim) and an output of 480 horsepower.

Musk quickly responded on twitter with a post that reads: "The gauntlet has been thrown down! The prophecy will be fulfilled. Model S price changes to $69,420 tonight!" TechCrunch reports that this is the second price cut Tesla made for the Model S this week. Earlier, the company already reduced the pricing by $3,000 ahead of Lucid Motor's launch of the Air in an attempt to undercut it.

Those who have been following Musk's antics on social media quickly pointed out what the oddly specific pricing alluded to. In fact, sources claim that it is not the first time he used any of the numbers in any form of communication. Lucid Motors CEO Peter Rawlinson was a former lead engineer who worked on the Model S during his time with Tesla.

Elon Musk
Elon Musk, founder of SpaceX, has credited NASA's support for the company's success Photo: AFP / Philip Pacheco

According to Musk, Rawlinson was in no way involved in the development of the Model S. However, he acknowledged some of the latter's contributions to the "body/chassis engineering." As for the software, electronics, battery, and electric powertrain, prototypes were already completed before he joined the company. It was likewise indicated that the Lucid Motors CEO left Tesla when it encountered difficulties.