Tesla plans to build new electric vehicles in mid-2025

Tesla is working on a new electric vehicle. The new EV is expected to be launched by mid-2025 and will sport a compact crossover
Tesla
Tesla is planning to introduce a new EV by mid-2025 which will be a compact crossover. (AFP)
Tesla
Tesla is planning to introduce a new EV by mid-2025 which will be a compact crossover.

Tesla has told suppliers it wants to start production of a new mass market electric vehicle codenamed "Redwood" in mid-2025, according to four people familiar with the matter, with two of them describing the model as a compact crossover.

Tesla CEO Elon Musk has long whetted fans' and investors' appetites for affordable electric vehicles and self-driving robotaxis that are expected to be made on next-generation, cheaper electric car platforms.

Also check these Bikes

Find more Bikes
Hero Electric Ae-3 (HT Auto photo)
UPCOMING
3 kWh 80 Kmph 100 Km
₹ 1.50 Lakhs
View Details
Odysse Electric Odysse Electric Hawk (HT Auto photo)
2.96 kWh 45 Kmph 170 Km
₹ 73,999 - 98,500
Compare
View Offers
Battre Electric Mobility Battre Electric Loev (HT Auto photo)
3.1 kWh 65 Kmph 60 km
₹59,900
Compare
Battre Electric Mobility Battre Electric One (HT Auto photo)
3.1 kWh 50 Kmph 85 km
₹74,000
Compare
Battre Electric Mobility Battre Electric Iot (HT Auto photo)
30 Ah 110 kmph 85 km
₹79,999
Compare
Battre Electric Mobility Battre Electric Gps:ie (HT Auto photo)
24 Ah 90 Kmph 65 km
₹64,990
Compare

Those models, including an entry-level $25,000 car, would allow it to compete with cheaper gasoline-powered cars and a growing number of inexpensive EVs, such as those made by China's BYD.

BYD overtookTesla as the world's top EV maker in the final quarter of 2023.

Musk had first promised to build a $25,000 car in 2020, a plan he later shelved and then revived. Tesla's cheapest offering, the Model 3 sedan, currently has a starting price of $38,990 in the United States.

Musk said last year he was concerned about the impact of high interest rates on consumer demand for big-ticket items like cars.

Tesla sent "requests for quotes," or invitation for bids for the "Redwood" model, to suppliers last year, and forecast weekly production volume of 10,000 vehicles, two of the sources said.

Production would begin in June 2025, three of the sources said. All spoke on condition of anonymity because the matter is confidential.

Tesla did not respond to a request for comment.

Timing of next-generation compact vehicles was one of the most voted questions by investors to Tesla ahead of its quarterly results report on Wednesday afternoon, where it is expected to forecast a 21% rise in 2024 deliveries, well below the long-term annual target of 50% that Musk set about three years ago.

Musk said in May that Tesla was working on two new products, with the potential for combined sales of 5 million vehicles a year. "Both the design of the products and manufacturing techniques are head and shoulders above anything else that is present in the industry," he said at Tesla's annual shareholder meeting.

Tesla plans to make an inexpensive robotaxi and an entry-level, $25,000 electric car based on the same vehicle architecture, according to Walter Isaacson's biography of Musk released in September, which includes interviews with the CEO and executives.

Musk said in 2022 that Tesla would make a dedicated self-driving taxi with a futuristic look in 2024, after several misses at its goal of achieving full self-driving capability.

He and other Tesla executives laid out plans last March to halve the cost of its next-generation vehicles, but did not provide a timeframe for the launches.

Studying a Honda Civic

Tesla has a track record of missing its targets for launches and pricing, and it would take time to build volume.

Cybertruck production, for instance, has been delayed and slow to accelerate and its $60,990 U.S. starting price is 50% higher than Musk touted in 2019.

"They have been overly optimistic on most of their new product launches. Volume output is more likely to begin in 2026," one of the sources said.

Musk said last year the affordable model would initially be built at Tesla's factory in Texas.

Making a profit from the cheaper EVs will be challenging, given the costs of batteries as well as traditional difficulties producing quality inexpensive vehicles.

Tesla in recent years tore down a Honda Civic, whose price starts at $23,950 in the United States, to study how to make cheaper cars, two separate sources said.

The next-generation Tesla architecture, internally called "NV9X," will include two or more models, said the two people and one of the initial sources.

Tesla also plans to build cheaper cars at its factory near Berlin, and is interested in building a factory in India to produce less expensive electric cars, sources said previously.

The EV maker also has factories in Shanghai and in Fremont, California.

(Reporting by Hyunjoo Jin and Joe White; Editing by Peter Henderson and Jamie Freed)

First Published Date: 24 Jan 2024, 12:03 PM IST
NEXT ARTICLE BEGINS

Please provide your details to get Personalized Offers on

Choose city
+91 | Choose city
Choose city
Choose city

Want to get the best price for your existing car?

Powered by: Spinny Logo
By clicking "View Offers" you Agree to our Terms and Privacy Policy

Dear Name

Please verify your mobile number.

+91 | Choose city
Couldn't verify the OTP.
It's either expired or it's incorrect.