Tesla has announced its plans to introduce new models into production in the second half of 2025, including more affordable options that were previously believed to have been canceled.
Contrary to recent reports suggesting the cancellation of a cheaper “Model 2” vehicle in favor of prioritizing a robotaxi, Tesla has confirmed its commitment to manufacturing more affordable electric vehicles, potentially as early as 2025. However, Tesla CEO Elon Musk did not provide specific details on whether these lower-cost EVs would be entirely new models or simplified versions of existing vehicles.
During Tesla’s first quarter earnings call, Musk addressed investor concerns about the delayed plans for a low-cost EV and acknowledged the discussions surrounding the company’s new product roadmap. Musk stated that Tesla has updated its future vehicle lineup to expedite the launch of new models, with a possibility of seeing these vehicles as early as early 2025 or even later this year.
The forthcoming vehicles will incorporate elements of a next-generation platform while leveraging the existing platform used in Tesla’s popular Model 3 and Model Y. Musk emphasized that the production of these vehicles would not require a new factory or extensive new production lines, as they would be manufactured more efficiently using the current production lines. He further predicted that this approach could potentially increase Tesla’s production capacity to over 3 million vehicles per year.
Tesla’s Q1 2024 financial performance
In the first quarter of 2024, Tesla reported $21 billion in revenue, marking a 9 percent decline compared to the previous year. Net income also decreased by 55 percent to $1.1 billion. The company experienced lower sales during this quarter due to a cooling demand for electric vehicles. Analysts believe that the introduction of a more affordable model is crucial for Tesla’s future growth.
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At the beginning of the call, Musk addressed concerns about the market’s emphasis on hybrid vehicles instead of fully electric ones, expressing his disagreement with this strategy. He mentioned that further details would be shared on August 8th, reiterating the plan to have 7 million cars as part of a robotaxi fleet by the end of this year. August 8th is the scheduled date for Tesla’s unveiling of a new robotaxi vehicle.
While Tesla has reiterated its commitment to releasing cheaper EVs, it has not confirmed whether these will be entirely new affordable models. It is plausible that the more affordable options could be stripped-down versions of the existing Model 3 and Model Y vehicles, which currently contribute significantly to the company’s revenue.
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