Spotted on the streets: Tesla's budget-friendly model sans glass ceiling yet to be launched
Tesla has begun the production of its long-awaited affordable electric car, with the first builds occurring in June 2025. The vehicle, expected to be more budget-friendly, will hit the market later in the year, marking a significant step for the electric vehicle (EV) industry.
The production timeline for the affordable Tesla electric car has been pushed back from the initial expectation of a Q2 launch to Q4. Despite the delay, Tesla CEO Elon Musk remains optimistic about the project, joking that the model may resemble the Model Y.
The affordable Tesla electric car will be a stripped-down version of the existing Model 3 and Model Y platform, featuring fewer features and budget materials to reduce costs. The test vehicle, spotted in the US, appears to be shorter in length than the standard Tesla Model Y, estimated to be between 4.4 and 4.6 meters in length.
Key updates on the production timeline and design changes include:
- Production timeline: Initial limited production ("first builds") occurred around June 2025, with mass or volume production planned for the second half of 2025.
- Design and platform: Instead of developing a new platform for the affordable EV, Tesla is repurposing the Model 3/Y architecture for cost efficiency. The new model will be slightly smaller than the Model Y and have a stripped-down interior and materials to reduce costs.
- Market positioning: This vehicle will sit below the Model 3 and Model Y in Tesla’s lineup, aiming at providing an entry-level affordable EV to combat competition and stimulate demand.
- Confusion and rumors: There has been some confusion and conflicting messaging from Tesla and Elon Musk about the continuation of the affordable EV project, but recent financial disclosures and reports confirm production is underway, pushing a 2025 launch.
Riz Akhtar, the founder of carloop, a Melbourne-based company specializing in Australian EV data, insight reports, and trends, has been closely monitoring the development of the affordable Tesla electric car. Akhtar, a mechanical engineer with a passion for EVs and a focus on reducing transport emissions in Australia, currently drives a red Tesla Model 3.
Key changes in the design of the affordable Tesla electric car include the removal of the panoramic glass roof and the use of fabric in seats, as indicated by the test vehicle. The lightbars featured on the new Model Y are not included in the design of the test vehicle, suggesting that the affordable Tesla electric car may not have the same design as the Model Y.
Competitors are offering more affordable options, potentially threatening Tesla's market lead in Australia. The launch of the affordable Tesla electric car could help Tesla maintain its position in the market and stimulate demand for EVs in the country.
In summary, Tesla is on track to launch this affordable EV later in 2025 with a practical design shift from a new platform to using the existing Model 3/Y platform with cost-cutting modifications, reflecting a strategic pivot to address current market demands.
The affordable Tesla electric car, initially slated for a Q2 launch in 2025, is now expected to hit the market in the latter half of the year due to production delays. To reduce costs, Tesla will repurpose the Model 3/Y platform for the new model, which will feature a smaller design, stripped-down interior, and budget materials. This strategic move in the automotive industry is an attempt to offer an entry-level affordable EV, stimulating demand and competing within the finance sector, particularly in the Australian market where competitors are already offering more budget-friendly options.
