Tesla reportedly has told suppliers it wants to start production of a new mass market electric vehicle codenamed Redwood in mid-2025, according to four Reuters sources, with two describing the model as a compact crossover.
Tesla CEO Elon Musk has long whetted fans' and investors' appetites for affordable electric vehicles and self-driving robotaxis that are expected to be made on next-generation, cheaper electric car platforms, the news agency noted.
Those models, including an entry-level $25,000 car, would allow it to compete with cheaper petrol cars and a growing number of inexpensive EVs, such as those made by China's BYD.
BYD overtook Tesla as the world's top EV maker in the final quarter of 2023.
Reuters said Musk had first promised to build a $25,000 car in 2020, a plan he later shelved and then revived. Tesla's cheapest offering, the Model 3 sedan, currently has a starting price of $38,990 in the United States.
Musk said last year he was concerned about the impact of high interest rates on consumer demand for big ticket items like cars.
Tesla sent "requests for quotes," or invitation for bids for the "Redwood" model, to suppliers last year, and forecast weekly production volume of 10,000 vehicles, two of the Reuters sources said.
Production would begin in June 2025, three of the sources said.
Tesla did not respond to a Reuters request for comment.
Timing of next generation compact vehicles was one of the most voted questions by investors to Tesla ahead of its quarterly results report on Wednesday afternoon, where it is expected to forecast a 21% rise in 2024 deliveries, well below the long-term annual target of 50% that Musk set about three years ago, Reuters said.
Musk said in May Tesla was working on two new products, with the potential for combined sales of 5m vehicles a year.
"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.
Tesla plans to make an inexpensive robotaxi and an entry-level, $25,000 electric car based on the same vehicle architecture, according to Walter Isaacson's biography of Musk released in September, which includes interviews with the CEO and executives, Reuters said.
Musk said last year the affordable model would initially be built at Tesla's factory in Texas, Reuters reported.
The next generation Tesla architecture, internally called NV9X, will include two or more models, Reuters sources said.
