- Tesla plans to start production of a more affordable EV in June, the company said in its more recent earnings call.
- The company said it was able to install the tooling for the new model at the same time that it transitioned its factories to build the refreshed 2025 Model Y SUV.
- The entry-level Model Y could just be a stripped-down Model Y, with Tesla stating that new models will "resemble in form and shape the cars that we currently make."
The Tesla Model 3 sedan and Model Y SUV start at $44,130 and $50,630, respectively, which seems like a pretty good deal given their competitive electric driving range, strong performance, and snappy infotainment interface. Still, Tesla has been mulling a more affordable EV, and despite rumors last year that plans for a smaller, less expensive Model 2 had been scrapped, the automaker now says it will launch a new entry-level model in June, as first reported by InsideEVs.
The confirmation of the impending arrival of a more affordable Tesla came in the company's first-quarter earnings call, where CFO Vaibhav Taneja stated that production of the affordable Tesla is slated to start in June. While that seems remarkably soon for a vehicle that has yet to be revealed, Tesla said it was able to start preparing its factories for the new variant at the same time that it was reconfiguring equipment to build the refreshed 2025 Model Y.
Tesla didn't provide many details on the new affordable model, but there are signs that point to it being a stripped-down Model Y rather than an entirely new vehicle. Tesla said that in order to keep costs down—with a reported target price of under $30,000, although this may be factoring in the EV tax credit—the new model will need to be built on existing assembly lines. Since Tesla could apparently retool its factories fairly easily for the new model at the same time as readying Model Y production, we think the affordable EV will share many parts with Tesla's bestseller.
There could be more than one entry-level EV, perhaps one based on the Model 3 and one based on the Model Y.
On the call, Tesla's VP of vehicle engineering, Lars Moravy, also stated that "the models that come out in the next months will resemble in form and shape the cars that we currently make," further solidifying the idea that they will be decontented versions of existing models. Moravy also said the "flexibility of what we can do within the form factor and the design of it is really limited to what we can do in our existing lines rather than build new ones." The plural of "models" in Moravy's quote also suggests there could be more than one entry-level EV, perhaps one based on the Model 3 and one based on the Model Y.
While the June start date for production feels impossibly close, Tesla expects the production ramp-up for this new model to be slow, so it may be several months before the new affordable Tesla starts truly flooding the streets. The entry-level EV could be crucial for Tesla, which reported that profits were down by 71 percent in the first quarter compared to the same time last year.
Caleb Miller
Associate News Editor
Caleb Miller began blogging about cars at 13 years old, and he realized his dream of writing for a car magazine after graduating from Carnegie Mellon University and joining the Car and Driver team. He loves quirky and obscure autos, aiming to one day own something bizarre like a Nissan S-Cargo, and is an avid motorsports fan.
