Lauren Ramesbottom

Lauren Ramesbottom

January 31, 2022 2:22 pm


Bad news, Tesla fans. According to Elon Musk, the automaker is not working on its previously announced US$25,000 electric car – at least, not right now.

Musk first teased the affordable EV at Tesla Battery day in 2020, noting that the car wouldn’t just have an attractive price tag – it would also be fully autonomous. According to Musk, this concept would be made possible thanks to Tesla’s new battery cell and manufacturing effort, which could “reduce battery costs by over 50 per cent.”

Sketch of Tesla Model 2

Sketch of Tesla Model 2

So, why has Tesla abandoned the project for the time being? According to Musk, the company simply has “too much on its plate” at the moment. Presumably, he’s referring to Tesla’s production schedule for the highly anticipated Cybertruck, as well as the Roadster, Model 3 and Model Y.

The aforementioned US$25,000 EV is often referred to as the Tesla Model 2 and, during company-wide meetings last year, Musk revealed that the car would likely not have a steering wheel.

Despite some media reports coming out of China that predicted the production of the vehicle “could start imminently”, it seems as though the project is officially on the backburner.

Tesla Roadster

Tesla Roadster

Now during Tesla’s Q4 2021 earnings, Musk was asked by shareholders about the status of the $25,000 Tesla and the CEO responded:
“Well, we’re not currently working on the $25,000 car. At some point, we will, but we have enough on our plate right now, too much on our plate, frankly. So, at some point, there will be,” said Musk on the Q4 2021 earnings call.

“It’s sort of the wrong question. Really, it’s really the thing that overwhelmingly matters is when is the car autonomous? I think, at the point in which it is autonomous, the cost of transport drops by, I don’t know, a factor of four or five.”

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