Tesla’s plans to launch an affordable electric vehicle in the US have hit a roadblock. The company was initially expected to release a stripped-down Model Y in the first half of 2025, but now that’s been pushed back to at least several months later, potentially as far as the third quarter of 2025 or early 2026.
Shifting Priorities
Elon Musk, Tesla’s CEO, had previously planned to develop a new platform for a $25,000 electric vehicle. However, he scrapped that plan and shifted focus to Robotaxi, a self-driving taxi that would utilize advanced technology. The new affordable Model Y will instead be based on the existing Model Y platform, albeit with some features removed to reduce costs.
Cost-Cutting Measures
To make the new Model Y more affordable, Tesla plans to use cheaper interior materials and strip away some luxury features. This approach is similar to what the company did with the Model 3 in Mexico last year, where they removed the rear-seat screen, interior lighting, and switched from vegan leather to fabric to cut costs.
Tesla is also planning to produce 250,000 units of the new Model Y in the US by 2026, which aligns with the reduced production capacity at its Gigafactory Texas and Fremont plants. The company may follow a similar strategy with the Model 3, potentially releasing a more affordable version later.
Challenges Ahead
Tesla is facing significant challenges, including declining sales and delayed development of its Full Self-Driving technology. By leveraging existing production lines to manufacture more affordable models, Tesla may be able to revive its sales and stay competitive in the market. Fans of the brand will have to wait and see how Tesla navigates these challenges and whether the company can bounce back.
Source: Electrek