Report: Tesla Plans to Launch Cheaper EV In 2025
Tesla has been promising a lower-priced, entry-level electric vehicle for years, but according to a new report by Reuters, it might finally be happening. Sources told the news agency that Tesla has begun the process of sourcing parts from suppliers for what is internally known as Redwood.
Related: 2024 Tesla Model 3 Receives Numerous Updates, Priced From $40,380
A $25,000 Tesla was initially promised in 2020, but the project was later put on indefinite hold. According to Reuters, the company is now targeting summer 2025 for the start of production and plans to build as many as 10,000 Redwoods a week. In 2023, Tesla said it planned to cut its manufacturing costs in half with its next-generation architecture, and that it would build more than one vehicle on the platform.
As is often the case with Tesla, though, some skepticism regarding these claims is warranted. Reuters quoted one of its sources as saying production is more likely to begin in 2026. Even that may be an ambitious timeframe, though, as sales of the Cybertruck finally began two years after they were initially promised. And when it did finally arrive, the Cybertruck cost about 50% more than had been promised.
Add the same margin to the promised $25,000, and the cost of admission rises close to the Model 3’s $40,380 starting price (with destination). Given the Model 3 just received a mild exterior refresh and significant interior makeover, it’s unlikely the upcoming entry-level vehicle is intended as a replacement. That means Tesla will have to exercise an unfamiliar degree of discipline to bring its new entry-level EV to market without cannibalizing sales from the Model 3. If there’s one thing we know for certain about Tesla, though, it’s that we’ll be hearing a lot more about the Redwood before it goes into production.
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