For years, Tesla CEO Elon Musk has been promising an affordable electric vehicle, likely priced at $25,000, as a way to broaden the appeal of plug-in vehicles.
He first mentioned it in a 2018 interview with YouTuber Marques Brownlee, saying “a $25,000 car, that’s something we can do.” Then in 2020, at the company’s first Battery Day event, he speculated that Tesla could eventually produce upward of 20 million of these vehicles in a year — or roughly twice the current production of Toyota, GM, or Volkswagen.
Things started to accelerate last year at Tesla’s shareholder event, where the company’s executives spoke about a specialized manufacturing technique that they called the “Unboxed Process.” This breakthrough would allow Tesla to dramatically reduce the cost of manufacturing, enabling it to sell a vehicle at the $25,000 price point.
The next-gen vehicle will likely be a crossover or hatchback and could feature design elements lifted from the Tesla Cybertruck. But moreover, it would be the fulfillment of a promise made years ago to make EVs more affordable to the masses.
Elon Musk makes a lot of promises, some of which he can’t keep. Let’s hope this isn’t one of them.
Tesla is eying a June 2025 kickoff for production of a new mass-market compact crossover, Reuters reports. The company has apparently invited suppliers to bid to work on the car, and is forecasting producing 10,000 vehicles weekly.
Following publication of this story, Tesla CEO Elon Musk responded to a question about “next-generation platform vehicles” during an earnings call by saying production would start “towards the end of 2025.” He also said the first manufacturing location for the company’s next-gen vehicle would be in Austin, Texas. No specifics on the features or pricing of the vehicles were offered, and Musk warned that his timeline “should be taken with a grain of salt” due to the complexities of developing new manufacturing technologies. “You have to design a machine that has never existed to build a car in a way that has never existed,” added Musk.
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Elon Musk revealed the third part of Tesla’s “Master Plan,” in which the company will lead the global effort to eliminate fossil fuels and convert the world to sustainable energy. The plan was outlined during an investor event Wednesday held at the company’s Gigafactory in Austin, Texas.
Master Plan 3 includes adding renewable power to the existing grid, producing more electric vehicles, installing heat pumps in homes and buildings, using high-temperature heat delivery and hydrogen for industrial applications, and building sustainably fueled planes and boats. Musk’s plan is to create “a sustainable energy civilization.”
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Tesla announced that it will dramatically reduce the cost of its battery cells and packs — which means the company’s new goal is a $25,000 electric car. The company’s CEO Elon Musk said its new “tabless” battery cells, as well as by changing the materials inside the cell, will allow Tesla to “halve” the price per kilowatt-hour, which will make electric cars roughly the same price as combustion engine ones.
The price per kilowatt-hour (kWh) is the unit of energy most commonly used to measure the capacity of the battery packs in modern electric vehicles. Those prices have been falling dramatically over the last decade, from $1,100/kWh in 2010 to $156/kWh in 2019, a drop of 87 percent.
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