Elon Musk-led Tesla Inc TSLA is reportedly considering the production of a new mass-market electric vehicle with the codename “Redwood.”
What Happened: Production of the new EV is expected to commence in mid-2025, and the vehicle is said to be a compact crossover, Reuters reported, citing people familiar with the matter.
It was not immediately clear if “Redwood” was the car with a potential price point of $25,000 that many analysts and Tesla fans have long anticipated.
As reported by Reuters, two distinct sources revealed that Tesla has, in recent years, dismantled a Honda Civic — a vehicle with a starting price of $23,950 in the U.S. — as part of a study on techniques to produce more cost-effective cars. The report further suggests that the upcoming Tesla architecture, internally referred to as “NV9X,” is set to include two or more models.
In December, Musk confirmed in a YouTube interview that Tesla is concurrently developing a more affordable car, expected to be made in high volume.
Current Lineup: Tesla’s current lineup includes the Model S, a luxury sedan with high performance; the Model 3, a more affordable and practical sedan; the Model X, an SUV featuring distinctive falcon-wing doors; and the Model Y, a compact SUV sharing a platform with the Model 3.
Additionally, Tesla has introduced the Cybertruck, an all-electric pickup truck with a unique design, with its highest-priced variant reaching around $100,000.
Why It Matters: During Tesla's annual shareholder meeting in May, Musk said that the company is working on two new products, a proper product launch for which shall be held at a later date.
"Both the design and manufacturing techniques are head and shoulders above anything that is present in the industry," Musk said.
The CEO added that Tesla would probably make 5 million units of these products, combined, in a year.
Tesla is currently facing increased competition, particularly from China’s BYD. In the last quarter, BYD trumped Tesla as the world's largest EV maker, selling more battery electric vehicles than Tesla.
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