Tesla Plans To Build New EVs In Mid-2025 - Sources

Tesla has informed suppliers that it plans to begin mass-market electric vehicle production in mid-2025 under the codename "Redwood," claimed four people with knowledge of the situation. Two of these individuals have described the model as a compact crossover. Elon Musk, the CEO of Tesla, has long piqued interest among investors and enthusiasts for low-cost electric cars and self-driving robotaxis, which are anticipated to be produced on more affordable next-generation electric car platforms, Reuters reported.

These models, which would include a USD 25,000 entry-level vehicle, would enable it to compete with increasingly affordable EVs, like BYD, and less expensive gasoline-powered vehicles.

Musk had earlier declared that he would produce a car for $25,000 by 2020; he later shelved and then resurrected this plan. In the US, the Model 3 sedan, which is Tesla's most affordable model, is currently available for USD38,990. He expressed concern last year about how high interest rates would affect consumer demand for expensive goods like cars. Two of the sources said that last year, Tesla issued "requests for quotes," or invitations for bids, to suppliers for the "Redwood" model, with a projected weekly production volume of 10,000 cars.

Three sources stated that June 2025 would mark the start of production. Due to the confidential nature of the subject, everyone spoke on condition of anonymity. Musk stated last year that Tesla's Texas factory would be the first to produce the entry-level model.

It will be difficult to turn a profit on the less expensive EVs considering the cost of batteries and the ongoing challenges in building high-quality, low-cost cars.

According to two different sources, Tesla disassembled a Honda Civic, which retails for USD23,950 in the US, in order to learn how to produce cars at a lower cost. The two individuals as well as one of the first sources claimed that two or more models will be part of the next generation Tesla architecture, internally dubbed "NV9X."

According to earlier reports, Tesla is interested in establishing a factory in India to produce less expensive electric cars, and it also intends to build cheaper cars at its factory near Berlin.