- Tesla’s ‘Redwood’: $25,000 EV
- Musk aims for affordability
- Challenges in production, profits
Midway through 2025, Tesla plans to release a new mass-market electric vehicle named ‘Redwood,’ priced at $25,000, making it the most affordable EV currently available.
A recent report suggests that the Elon Musk-owned company sent supplier quote requests last year, projecting a weekly production of 10,000 compact crossovers starting in June 2025.
‘Redwood’ might be part of Musk’s 2020 commitment to offer more affordable electric vehicles.
This move could be Musk’s effort to attract more customers, considering a 15% drop in sales of Tesla’s cheapest model, the $43,900 Model 3, from 2018 to 2022.
Insiders revealed details to Reuters, noting Tesla’s history of missing launch and pricing targets, emphasizing the challenge to build volume as outlined in notes to suppliers.
Cybertruck production has been slow, starting at $60,990, 50% more than Musk’s 2019 prediction, with an inconspicuous base price increase to $79,990.
Tesla aims to initiate volume production in 2026, focusing on making affordable electric vehicles at its Texas plant.
The challenge lies in generating profits due to high battery costs and typical challenges in manufacturing quality affordable vehicles.
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Tesla Eyes Affordable EVs
Tesla reportedly examined a Honda Civic to learn how to produce more affordable vehicles; part of their next-generation architecture, internally dubbed ‘NV9X,’ is expected to include at least two models.
Sources also indicate Tesla’s interest in building a factory in India to produce electric vehicles at a lower price.
The news of ‘Redwood’ surfaced after Tesla’s quarterly results were released earlier this month, aligning with the pressure on Musk to manufacture compact vehicles to boost deliveries.
During a recent call, Musk projected a 21% increase in deliveries this year, falling short of his earlier goal of 50% annual growth.
In May, Musk announced the development of two new vehicles, a low-cost robotaxi and a $25,000 entry-level electric car, aiming for annual sales of five million units.
Musk’s predictions included a dedicated self-driving taxi by 2024. However, the specific timeline for vehicle introductions remains unspecified, following strategies unveiled in March of the previous year to cut the price of next-gen vehicles by half.
