Tesla CEO, Elon Musk, has said that a six-seat Model Y variant, which debuted in China recently, may not be produced for the US market.
He attributed the potential decision to the anticipated dominance of self-driving cars, Reuters reported.
The Model Y L, assembled at Tesla's Shanghai facility in China, has a lengthier wheelbase and a three-row seating arrangement, carrying a price tag of approximately $47,200.
Tesla is contending with increased competition in China from local electric vehicle (EV) manufacturers like BYD and Xiaomi, according to the report.
In the report, the CEO did not explain how the advent of autonomous driving technology would diminish demand for six-seater models.
In the US, gasoline-powered SUVs featuring three rows of seats are said to have traditionally been favoured by families.
Nonetheless, the production of “profitable” three-row EVs poses a significant challenge for carmakers.
Furthermore, recent policy shifts introduced by the Trump administration are poised to raise the cost of EVs, leading manufacturers to prioritise smaller and more affordable models.
Tesla is also gearing up to introduce a more budget-friendly Model Y version, which is expected to lack some of the premium features and is set to launch later in 2025.
Musk has referred to it as "just a Model Y."
The company's strategy in the US is increasingly pivoting towards its robotaxi project. In June, Tesla initiated a limited robotaxi service in Austin and plans to expand its reach to cover half of the US population by year's end.
In the US, the EV maker secured a licence to operate its robotaxi service in Texas, aligning with the state’s new autonomous vehicle regulations.
Musk has previously informed investors that in a future dominated by autonomous vehicles, the production of conventional cars would be rendered "pointless".
Tesla is scheduled to commence manufacturing of the bespoke two-seater robotaxi without a steering wheel or pedals, Cybercab, in 2026.
Recently, the EV maker has announced significant cuts to the monthly lease rates for its electric vehicles in the UK, now offering them at just above half the price compared to last year.
Data from the Society of Motor Manufacturers and Traders (SMMT) reveals a stark decline in Tesla's UK sales in July, with only 987 vehicles sold, representing a 60% decrease.
This comes in the context of an overall market contraction of 5% in July in the UK.
For the second quarter (Q2) of 2025, Tesla has reported a 12% year-on-year reduction in total revenue, with earnings dropping to $22.49bn from $25.5bn in the previous year's corresponding period.
