Tesla "cheaper model" initial details shared in recent Reuters report

03/14/2025 11:11 AM

The initial details of Tesla's alleged "cheaper model" have been shared in a recent report from Reuters. As per the publication, the upcoming vehicle is designed to grow Tesla's market share in the highly competitive Chinese EV segment.

Cheaper Model

Citing three people reportedly familiar with the matter, Reuters claimed that the cheaper Tesla will be produced at Gigafactory Shanghai to start. The publication also claimed that the cheaper Tesla will be based on the Model Y, echoing recent reports about a more affordable Model Y variant launching in the Chinese market.

First Details

As per Reuters' sources, the Model Y-based affordable model is being developed under a project codenamed "E41." The vehicle will reportedly be built using the company's existing production lines, though mass production will reportedly start at Gigafactory Shanghai in 2026.

While the upcoming vehicle will reportedly be based on the Model Y, it will be a smaller car overall and cost at least 20% less to produce than the new Model Y that Tesla launched this year. The vehicle will reportedly not be exclusive to China, as it will also be produced in North America and Europe.

Tesla's Affordable Tease

Elon Musk mentioned Tesla's affordable model during the fourth quarter 2024 earnings call. As per the CEO, Tesla is "still on track to launch a more affordable model in the first half of 2025 and will continue to expand our lineup from there."

Tesla, however, has so far been very tight-lipped about its affordable model, leading to speculations that the vehicles may simply be stripped-down versions of the Model 3 and Model Y, the company's two best-sellers.

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