Elon Musk says the priority of his company is now to engineer smaller vehicles than the Model 3 and Y.
The company had talked about a possible $25,000 EV a few years ago
According to the CEO, these vehicles could be made profitable by cutting production costs by about half
Tesla is apparently working on a new platform that will be used by new EVs which will be smaller and more affordable than the current Model 3 and Model Y.
The company’s CEO, Elon Musk, said in a conference call this week that Tesla is done engineering the Cybertruck and the Semi.
According to him, the priority of the firm’s engineers has thus shifted to the smaller models, which could be launched in a few years.
This is not the first time Musk teased a more affordable Tesla since a few years ago, he said the Model 3 would start at $35,000 and a smaller model (dubbed Model 2) would start at $25,000.
The $25,000 EV never materialized but the $35,000 Model 3 did exist, if for a very short time. With more and more automakers working on affordable EVs, Tesla needs to occupy this section of the market in order to remain the global EV leader.
Indeed, price is still one of the major obstacles to the popularity of electric vehicles in North America and a number of automakers have acknowledged they need to offer EVs that are more affordable than their current models to reach new buyers.
Musk is confident Tesla will be able to make a cheaper vehicle profitable by making its production process more efficient and therefore less expensive. This could make it possible to sell electric vehicles that cost about half as much as the current Model 3 and Y.
Considering that the Model 3 currently starts at $48,490 in the United States, this means that a $25,000 EV could be possible after all.
Making these vehicles a priority is good news for potential buyers who find the brand’s current offerings out of their budget, but it could also make a few Tesla Fans unhappy.
Indeed, these models seem to have cut the line in front of the new Roadster, which could be delayed even further.