Elon Musk’s Tesla plans to build a NEW $25,000 mass-market electric vehicle codenamed ‘Redwood’ by mid-2025
Tesla has plans for a new mass-market electric vehicle codenamed ‘Redwood’ in mid-2025, which would start at $25,000, making it the cheapest electric car available.
The Elon Musk-owned company is said to have sent quotes to suppliers last year, predicting weekly production of 10,000 compact crossovers when production starts in June 2025, according to a new report.
The billionaire promised in 2020 that customers would get a cheaper electric vehicle β and ‘Redwood’ could be part of that plan.
The move could be Musk’s strategy to attract more buyers, as Tesla’s cheapest model β the Model 3 β at $43,900, saw a 15 percent drop in sales last year compared to 2022.
Tesla may have plans for a new mass-market electric vehicle by mid-2025, codenamed “Redwood,” which would start at $25,000, making it the cheapest electric car available. The Model 3 (pictured) is Tesla’s cheapest vehicle at $43,900
People familiar with the matter revealed details to Reuters, which noted that Tesla has a track record of missing its launch and pricing targets, and that it would take time to build volume as suggested in the commentary to suppliers.
Production of Cybertrucks has been delayed and is coming slowly β and the starting price of $60,990 is 50 percent higher than Musk touted in 2019.
However, Tesla quietly raised the starting price tag to $79,990 after its official launch in December.
βThey have been overly optimistic about most of their new product launches. It is more likely that volume production will begin in 2026,β one of the sources said.
Musk said last year that Tesla’s Texas factory would produce affordable electric vehicles.
The Elon Musk-owned company is said to have sent quotes to suppliers last year, forecasting a weekly output of 10,000 compact crossovers when production starts in June 2025.
Making a profit from cheaper electric vehicles will be a challenge given the cost of batteries and the traditional difficulties of producing high-quality, low-cost vehicles.
Tesla has in recent years scrapped a Honda Civic, which starts at $23,950 in the United States, to explore how to make cheaper cars, two separate sources said.
Tesla’s next-generation architecture, internally called “NV9X,” will include two or more models, the two people and one of the early sources said.
Tesla also plans to build cheaper cars at its factory near Berlin, and is interested in building a factory in India to produce cheaper electric cars, sources previously said.
The news about ‘Redwood’ came after Tesla reported its quarterly results earlier this month.
Investors have been pressuring Musk to produce compact vehicles in an effort to boost yields.
Tesla has a reputation for not meeting its launch and pricing targets, and it would take time to build volume as suggested in the supplier notes. Production of Cybertruck (photo) has been delayed and is slowly getting underway
On the call this month, deliveries were forecast to be 21 percent this year – well below the annual long-term target of 50 percent 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 five million vehicles per year.
βBoth the design of the products and the manufacturing techniques are head and shoulders above anything else in the industry,β he said at Tesla’s annual shareholder meeting.
The plans included a low-cost robotaxi and a $25,000 entry-level electric car based on the same vehicle architecture, according to Walter Isaacson’s biography of Musk released in September that includes interviews with the CEO and executives.
Musk said in 2022 that Tesla would create a special self-driving taxi with a futuristic appearance in 2024, after several misses in its goal of achieving full self-driving capability.
He and other Tesla executives last March laid out plans to halve the cost of next-generation vehicles, but gave no timetable for the launches.