Tesla said on its most recent earnings call that it will begin making a cheaper electric vehicle in June. The company stated that the tooling for the new vehicle was completed simultaneously with the relocation of its plant to produce the redesigned 2025 Vehicle Y SUV. Since Tesla has said that the new models will “resemble in form and shape the cars that we currently make,” the Model Y could be an easier version of the current model. The Tesla Model 3 sedan has a starting price of $44,130, while the Model Y SUV begins at $50,630. Both have a good range for an electric car, strong speed, and an easy-to-use touchscreen interface. Last year, there were worries that Tesla had scrapped plans for a smaller, cheaper car 2. However, the company has been working on a cheaper electric vehicle. News site InsideEVs says the company will release a new entry-level car in June. According to CFO Vaibhav Taneja, making the least expensive Tesla will start in June. He announced the news during the company’s first-quarter earnings call. Tesla stated it may begin preparing its factories for the new model while also reorganizing equipment to produce the improved 2025 Model Y. This is a very early announcement for a car that hasn’t even been shown off yet. Tesla hasn’t said much about the upcoming cheap model, but some people think it might just be a Model Y with some changes made to it instead of a whole new car. Tesla said that the new model would have to be made on current assembly lines to keep costs low. They want the price to be less than $30,000, but that price may already include the EV tax credit. The cheap EV will have a lot in common with Tesla’s best-selling car since the company seeks to change how its plants work for the new model while getting ready to make the Model Y. Lars Moravy, Tesla’s vice president of vehicle engineering, said on the call, “The models that come out in the next few months will look and feel a lot like the cars that we currently make.” This added to the idea that they will be unhappy versions of current models. Moravy explained that their flexibility in working within the form factor and its design is largely constrained by what their existing production lines can handle, rather than having the option to build new ones. As Moravy’s use of the word “models” suggests, there may be more than one entry-level EV. For instance, one might be built on Model 3 while the other is based on Model Y. Even though the start date for production in June looks like it will be coming up quickly, Tesla expects production of this new model to ramp up slowly, so it could be many months before the new, more affordable Tesla really takes over the streets. The entry-level EV could play a crucial role for Tesla, as the company’s first-quarter profits dropped by 71% compared to the same period last year.
