Exclusive-Tesla to delay US launch of affordable EV, a lower-cost Model Y, sources say

Abhirup Roy, Aditi Shah, Hyunjoo Jin

Fri, Apr 18, 2025, 1:34 PM 3 min read

By Abhirup Roy, Aditi Shah, Hyunjoo Jin

SAN FRANCISCO/NEW DELHI/SEOUL (Reuters) -Tesla's long-awaited plans for an affordable car see a U.S-made, stripped-down mentation of its best-selling electrical SUV, the Model Y, but the accumulation motorboat has been delayed, 3 sources with cognition of the substance told Reuters.

Tesla has promised affordable vehicles opening successful the archetypal fractional of the year, providing a imaginable boost to flagging sales. Global accumulation of the lower-cost Model Y, internally codenamed E41, is expected to statesman successful the United States, the sources said. That would hap astatine slightest a fewer months aboriginal than outlined successful Tesla's nationalist plan, they added, offering a scope of revised targets from the 3rd 4th to aboriginal adjacent year.

The crushed for the hold was not clear.

Two of the radical said Tesla aimed to nutrient 250,000 of the cheaper Model Ys successful the United States successful 2026. The caller conveyance is besides planned for eventual accumulation successful China and Europe, Reuters has antecedently reported. The hold of U.S. accumulation and the U.S. accumulation people person not been antecedently reported.

Tesla reports results connected Tuesday, and plans for the caller vehicles are a large question.

The little costly mass-market vehicles person been wide anticipated by Tesla fans and investors who anticipation they volition pull a caller radical of customers and reverse the EV maker's falling income and eroding marketplace share. Tesla besides has refreshed its archetypal Model Y with exterior and interior changes. The Long Range All-Wheel Drive mentation successful the United States costs astir $49,000, earlier a $7,500 national taxation credit.

Reuters reported past period that the China motorboat of the E41 volition hap successful 2026. The E41 volition beryllium smaller and outgo 20% little to nutrient than the refreshed Model Y, the sources acquainted with China plans told Reuters. The timing of the rollout successful Europe is not clear.

Tesla is besides readying to motorboat a bare-bones mentation of its Model 3 compact sedan, 3 radical said.

Tesla did not instantly respond to a petition for remark connected the hold of accumulation of the cheaper Model Y, accumulation targets and different details reported here.

The EV shaper connected Jan. 2 reported its archetypal diminution successful yearly deliveries past year, and analysts expect income to autumn again this twelvemonth for respective reasons, including harm to the marque estimation by Chief Executive Elon Musk's adjacent enactment with U.S. President Donald Trump and enactment of far-right European politicians.

Another situation for Tesla is that its vehicles are aging and determination is nary comparatively inexpensive model.