The entry-level model that has long been promised but might not be part of the plan.
Key Takeaways
- Tesla may be scrapping plans for an affordable car in order to focus on robotaxis.
- A $25,000 car was promised by Elon Musk as recently as January.
- Musk refuted the cancellation on X, but the company has made no official statement.
Tesla has long promised an affordable electric vehicle for the masses. It’s something CEO Elon Musk has said would happen since the early days of the company, but it looks like that plan might not be happening after all.
Reports indicate that the automaker has scrapped that plan completely and will instead be focusing its efforts on self-driving robotaxis. These taxis will use the same small-vehicle platform that would have been used for the canceled small car.
Canceled or Not?
As recently as January, Musk told investors that the car was still on its way. It was supposedly going to be produced at the Tesla Gigafactory in Texas sometime in the last half of 2025. Right now, the cheapest Tesla on the market is the Model 3, which comes in at about $39,000. That’s not a luxury car price, but it’s not exactly affordable for most people.
The reportedly canceled car, which was often referred to as the Model 2, would have been priced at only $25,000. That difference in price could have made Tesla ownership a possibility for a whole new group of buyers. Tesla hasn’t responded to the news, but Musk refuted the claims on his X account.
Changing Plans
The electric vehicle market is softening with automakers slowing down their plans for new EVs and in some cases putting those plans on hold temporarily. There’s also more competition than ever, where once Tesla was the only real option in the US.
Now there are plenty of choices from cars to trucks to SUVs. Tesla recently rolled out its Cybertruck, which is far from affordable at a starting price of around $82,000. A low-priced car was next in line for development, but as the market changes, so does Tesla’s business plan. That might mean robotaxis are in and a small affordable car is out.
