Tesla targets 2025 for new £25,000 entry-level car

Mike Askew

25 Jan 2024

Tesla’s long-anticipated £25,000 entry level car could finally be a reality next year. The brand has approached a number of suppliers with regard to the project, a move that effectively confirms that the car is reaching the final stages of design. 

Although company boss Elon Musk has suggested on numerous occasions that a new entry level model is just around the corner, the project has been on the backburner as the brand built volume for the Model Y and Model 3. Musk has also prioritised other Tesla projects such as the recently launched Cybertruck and has diverted software engineers to X (formerly Twitter). 

The new car is expected to take the form of a small crossover that will sit below Tesla’s current models. Crucially, it will be built on an all-new platform that is likely introduce a number of industry-first production processes to reduce costs. Development of the new car will run alongside another much-delayed Musk project – a Robotaxi that drives itself. Both vehicles will share the same platform, battery and running gear, with the Robotaxi featuring a futuristic exterior and a interior without driver controls. Tesla is expecting its FSD self-driving software to be advanced enough to deliver a fully automated driving experience. 

In a post-earnings call on 24th January 2024, Musk confirmed that production of the new car, which has the codename ‘Redwood’, will start in the second half of 2025. He also confirmed that a new factory in Mexico will be used for production of the new model, along with a yet-to-be-confirmed site outside the US. Musk admitted that ramping up production would be a challenge. Suppliers contacted by the brand suggest that production is set to be pinned at 10,000 units per week in the initial stages. 

Commenting on its sales performance and ambition for the new models, the brand said: "In 2024, our vehicle volume growth rate may be notably lower than the growth rate achieved in 2023, as our teams work on the launch of the next-generation vehicle at Gigafactory Texas.“

In May last year, Musk predicted that combined sales of the two new models could reach as high as five million units."Both the design of the products and manufacturing techniques are head and shoulders above anything else that is present in the industry," he said at the brand’s annual shareholder meeting.

How the new entry-level model could look when it arrives next year

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