Tesla has told suppliers it wants to start production of a new mass market electric vehicle codenamed “Redwood” in mid-2025.
Tesla CEO Elon Musk has long whetted fans’ and investors’ appetites for affordable electric vehicles and self-driving robotaxis that are expected to be made on next-generation, cheaper electric car platforms.
Those models, including an entry-level $25 000 car, would allow it to compete with cheaper gasoline-powered cars and a growing number of inexpensive EVs.
Musk had first promised to build a $25 000 car in 2020, a plan he later shelved and then revived. Tesla’s cheapest offering, the Model 3 sedan, currently has a starting price of $38 990 in the United States.
Musk said last year he was concerned about the impact of high interest rates on consumer demand for big-ticket items like cars.
Tesla sent “requests for quotes,” or invitation for bids for the “Redwood” model, to suppliers last year, and forecast weekly production volume of 10 000 vehicles, two of the sources said.
Production would begin in June 2025, three of the sources said.
Timing of next-generation compact vehicles, opens new tab was one of the most voted questions by investors to Tesla ahead of its quarterly results report on Wednesday afternoon, where it is expected to forecast a 21% rise in 2024 deliveries, well below the long-term annual target of 50% that Musk set about three years ago.
Musk said in May that Tesla was working on two new products, with the potential for combined sales of 5 million vehicles a year.
Tesla plans to make an inexpensive robotaxi and an entry-level, $25 000 electric car based on the same vehicle architecture, according to Walter Isaacson’s biography of Musk released in September, which includes interviews with the CEO and executives.
Musk said in 2022 that Tesla would make a dedicated self-driving taxi with a futuristic look in 2024, after several misses at its goal of achieving full self-driving capability.
Musk said last year the affordable model would initially be built at Tesla’s factory in Texas. Tesla also plans to build cheaper cars at its factory near Berlin, and is interested in building a factory in India to produce less expensive electric cars, sources said previously.
The EV maker also has factories in Shanghai and in Fremont, California.
