Way back in September 2020, Tesla CEO Elon Musk planted the idea of a “compelling” $25,000 electric vehicle. The promise came as the company worked to reduce the cost and boost the range for its EV batteries.
That attractive price point has been a lingering idea for Tesla in the years since Musk threw out the figure during a “Battery Day” event. But this week, during the company’s third quarter earnings call, Musk called a regular $25,000 Tesla model “pointless” and “silly.”
“Like, it’ll be completely at odds with what we believe,” he told investors.
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What Tesla does believe is that the future of the automotive industry is almost entirely electric and autonomous. Musk went so far as to say non-autonomous gasoline vehicles in the future will be like riding a horse and using a flip phone. He said, “It’s not that there are no horses. There are some horses, but they’re unusual. They’re niche.”
The future according to Tesla will look more like its recently unveiled Robotaxi, which Musk said will be priced below $30,000 with incentives. The Robotaxi looks similar to existing Tesla models with its distinctive shape and its gull-wing doors but it skips out on familiar features like a steering wheel and pedals. The company expects the Robotaxi will go into production by 2026.
It’s possible that the Robotaxi was what Musk had in mind all along when he surfaced his plans for a $25,000 EV. But given the ambiguity of the statement and reports as late as last year that Tesla was still working on a less-expensive model, made possible by manufacturing advances like giga casting, it was reasonable to still expect a budget-friendly, traditional EV.
Tesla may have flip-flopped on its design strategy, but the company’s most recent financial results don’t suggest an automaker in need of a less-expensive model to help boost sales. The company said it made $2.17 billion during the third quarter, a significant increase compared to the $1.85 billion it made during the same quarter of 2023.
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