Tesla's Budget-Friendly EV Set for Release: Smaller, More Affordable Model Y — Report

The upcoming electric vehicle, designated as "E41," will utilize current components and production lines yet will be priced at least 20% lower than the Model Y.

• Tesla's less expensive electric vehicle will be released later this year.
• As per anonymous informants, this new model will be a downsized and more affordable variant of the Model Y crossover.

There have been rumors about a more budget-friendly Tesla electric vehicle for a few years , yet everything appears to be falling into place. As stated by three individuals familiar with the situation, as cited by Reuters , Tesla plans to introduce an affordable variant later this year in an effort to reclaim lost market share both within China and globally.

The initiative dubbed "E41" will initially be constructed in Shanghai utilizing present production facilities and technology from current vehicles to maintain lower expenses. According to two anonymous sources cited by Reuters, this automobile will be more compact and could cost at least 20% less to produce compared to its counterparts. refreshed Model Y This new data should finally debunk the speculation that Tesla’s forthcoming cheaper electric vehicle will merely be a stripped-down variant of the Model Y.

That’s what occurred in Mexico last year when Tesla began sales. a cheaper version of the electric sedan With fabric seats, lacking a rear-facing screen, offering only white ambient lighting, and without heated seats or steering wheel. By incorporating these features, the basic Model 3 in Mexico has a price tag of approximately $4,000 less compared to the version destined for the United States.

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The mass production of an downsized and more affordable version of the Model Y will commence next year in China. This model will also undergo manufacturing in Europe and North America; however, specific timelines have yet to be announced. Initially reported by Reuters, this development from Tesla aims at countering competition within the Chinese market with their new electric vehicle. 36kr According to the source from China, the new model is referred to as a "more affordable version of the Model Y."

Earlier this year, Tesla stated during their fourth-quarter 2024 earnings announcement that they are still on schedule to begin producing new vehicles, which will include more budget-friendly options, starting in the first half of 2025. Additionally, the firm mentioned that these new electric vehicles are progressing as planned. Would utilize portions of its upcoming platform As well as being available on its present platforms, it will be manufactured using the same production lines as the current range of passenger vehicles. This means that the reports from Reuters and 36kr align perfectly with Tesla’s official stance.

Despite all these details, many questions remain unresolved. The appearance of the new EV and the range of powertrains offered are yet unknown. However, it’s probable that the US-based manufacturer will employ the same electric motors and battery packs currently used in their Model 3 and Model Y vehicles.

Last year, Tesla saw its first-ever sales decline . Despite the Model Y being a best-seller in many markets, the company’s grip is slipping. In the European Union, Tesla’s registration numbers dropped by 13.1% in the previous year In China's electric vehicle market, Tesla's market share decreased from 11.7% in 2023 to 10.4% the previous year. In the United States, It lost 10 percentage points in the EV market share. , concluding 2024 at 45.4%.