Tesla has been working on a new electric vehicle platform that promises to make its EVs more affordable and mass-market than its current lineup. Ever since Tesla CEO Elon Musk made the announcement, there has been talk of Tesla building an electric car that costs less than $25,000 for the past few years. Recently, Tesla has been circulating sketches of a compact hatchback, believed to be the electric automaker’s most anticipated entry-level model.
Elon Musk is expected to unveil the new entry-level Model 2 electric car at an investor day event on March 1. Before that, a sketch of the EV appeared in an ad shared by the automaker inviting Chinese employees. Tesla has previously said the new entry-level electric car will be designed, developed and produced in China for the global market. Recently, the electric automaker shared a glimpse of sketches in a video of Tesla’s new engineering headquarters in California. The video also glimpses other sketches of the upcoming model, possibly a facelifted version of its current lineup.
The upcoming cheap electric car will reportedly be 15% shorter and 30% lighter than Tesla’s smallest vehicle to date, the Model 3. Upcoming EVs may also feature battery packs that are 25 percent smaller. With all the changes in the design, architecture and manufacturing of electric models, the overall cost of new EVs will be reduced by 37%, the report said. Elon Musk had earlier said the new platform would be able to produce electric cars at half the cost of the Model Y and Model 3.
If all of this turns out to be true, it would mean gross margins on Tesla’s Model 2 of more than 20%. Smaller EVs could help Tesla boost sales in China and give Tesla a way to slowly build interest in similar models in the U.S. market.
First published date: March 1, 2023 at 09:01 AM CST
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