- Tesla is delaying the launch of its more affordable models, according to a new report from Reuters.
- A stripped-down, cheaper version of the Model Y was supposed to arrive in the first half of 2025, but sources say that ain’t happening.
- It will eventually be joined by a cheaper Model 3, too, but you might not see either until late 2025 or early 2026.
Tesla is delaying its affordable models again, a new report from Reuters, citing three sources, alleges. This comes after the company has repeatedly failed to deliver the cheaper models it has long promised, choosing instead to focus on Robotaxis and autonomy.
The car—which has been called the Model A, Model 2, Model Q and internally the E41, per Reuters—is supposed to be a cheaper vehicle based on the Model Y. The idea is to use a paid-off platform to make a de-contented version that’s cheaper to produce, allowing Tesla to provide the sub-Model-3 entrance point it has promised for years. That could be a huge win. Boy, does Tesla need a win.
Photo by: Theottle
Our render of what a cheaper Tesla could look like.
But that’s being back-burnered yet again, according to this report. While Tesla has claimed that more affordable models would arrive in the first half of 2025, the sources tell Reuters that it may not arrive until late 2025 or early 2026. This follows the time-honored tradition of Tesla product cycles: Promise something you can’t do yet, but say it’s just around the corner. When you get close to the originally announced timeframe, delay, but maintain that it’s coming soon.
Frankly, though, this is no surprise. Tesla is a company in crisis, and as I wrote recently in my Power Moves newsletter it’s quite a bad time for the brand to launch a cheaper product. While two years ago anything with a Tesla badge would sell like ice cream on a summer day, these days the badge has become a bit of a liability. Tesla trade-ins are soaring while used Tesla values plummet. Sales are struggling all over the world despite generous incentives. And its one truly new product in the last 5 years, the Cybertruck, has massively underperformed expectations.
Already, the cheaper products were a step back from the original vision of a bespoke, $25,000 Tesla. CEO Elon Musk spiked that in favor of the Robotaxi, ostensibly slated for 2026 but with no real signs of ongoing development. Now, the plan is to do this de-contented Model Y and, per Reuters, a cheaper version of the Model 3 to go alongside it. Whether either will be enough to reignite excitement for the brand remains to be seen, and now it sounds like we won’t see for quite some time.
Nobody gave Reuters a reason for the delay. Perhaps the timeline was always more ambition than concrete. Perhaps tariff uncertainty threw the plan off. Maybe Musk’s job at the Department Of Government Efficiency has kept him too distracted to crack the whip at Tesla. Regardless, the affordable Tesla was already coming too late. Any further delays are not just bad news for Tesla and its investors. It’s also a major loss for Americans who want a cheap EV from the only company making consistently great mass-market EVs right now.
Contact the author: Mack.Hogan@insideevs.com.
