Tesla has told suppliers it will be building a new range of affordable electric cars from next year, offering a mass-market model which will allow it to compete with cheaper petrol-powered vehicles.
CEO Elon Musk revealed that production will be starting for the new EVs – codenamed ‘Redwood’ – in mid-2025, according to reports from Reuters.
Expected to include at least one entry-level model (£20,000), the move would allow Tesla to meet the market need for cheaper electric vehicles. A basic Tesla Model 3 – the cheapest model available – currently costs upwards of £40,000 to buy new.
The UK government recently mandated that 80% of new cars sold in the UK will be zero emission by 2030. This was rowing back on its previous commitment to make 100% of new cars zero emission in the same period, in what it called a more “proportionate approach to net zero”.
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For its part, Tesla has recently been overtaken as the world’s leading electric vehicle maker, with China’s BYD – which offers a growing number of inexpensive EVs – taking that title in the final quarter of 2023.
The high cost of batteries makes producing cheaper EVs a significant challenge, in addition to the more traditional difficulties surrounding safety and reliability which come from producing affordable or inexpensive vehicles.
Musk said in May last year that Tesla was working on two new products which would have the potential for selling an additional 5 million vehicles a year between them.
“Both the design of the products and manufacturing techniques are head and shoulders above anything else that is present in the industry,” he said at Tesla’s annual shareholder meeting.
Production on Tesla’s latest models is expected to begin in June 2025, with insiders predicting that around 10,000 vehicles will be made each week. Insiders have also described at least one of the proposed models as a ‘compact crossover’.
Tesla also partnered with EG Group in November 2023 to roll out ultra-fast EV charging points across the UK and Europe.
