- A $25,000 EV is pointless and silly, according to Tesla CEO Elon Musk
- The future is autonomous in Musk's view
- But Musk reiterated that we need to make EVs affordable for everyone
In the automaker's third-quarter earnings call, Tesla CEO Elon Musk did an about face from the idea of a $25,000 electric vehicle that he had previously promoted.
Tesla will only build a $25,000 EV as a robotaxi designed for autonomous ride-sharing, Musk said in response to a question about when investors can expect a conventional EV from the automaker at that price point, according to a summary of the exchange from InsideEVs.
"Basically, having a regular $25,000 model is pointless. It would be silly. It would be completely at odds with what we believe," Musk said, adding that "I think we have been very clear that the future is autonomous."
Tesla Robotaxi Cybercab
Tesla revealed its vision of this future in the form of the autonomous Cybercab and Robovan concepts at an event earlier in October. The Cybercab, a two-seater that doesn't have a steering wheel or any pedals, will launch "before 2027" and cost less than $30,000, Musk said at the event. But this all-in approach to autonomous driving is a relatively recent development.
Musk has discussed plans for a $25,000 Tesla since 2020, when he made the idea of a "compelling" entry-level EV the focus of Tesla's Battery Day presentation. At the time, Musk said affordability would be enabled partly by the scaling up of large-format batteries and improved chemistries—including lithium iron phosphate (LFP)—and that the $25,000 EV would arrive by 2023.
Tesla has sent conflicting signals on the project since then. In 2021 a top Tesla executive in China said the affordable EV was under development there. Some time later Musk said the company wasn't working on a $25,000 EV, and that the robotaxi project was more important.
$25,000 Tesla teased for 2023 - Battery Day
In January of this year, Tesla reportedly reportedly made a call to suppliers in preparation for an affordable model due to arrive in 2025. The report's sources implied a total annual output for the model, codenamed Redwood, of more than 500,000 units.
In a presentation and Q&A for investors the following day, neither the company nor Musk described the $25,000 Tesla project. However Musk spoke to some of the rationale for such a model, noting that many of the bestselling internal-combustion vehicles globally cost less than the Model Y and Model 3 currently do. Another report in April said the project had been completely nixed which, combined with Musk's comments in the Q3 investor call, would seem to be the end of the matter. But not quite.
During the same call, Musk also said that "we need to make EVs affordable for everyone, including making total cost of ownership per mile competitive with all forms of transportation," adding that "Preparations remain underway for our offering of new vehicles—including more affordable models—which we will begin launching in the first half of 2025."
