There is a cheaper Tesla coming, but it’s not what you expected (or maybe it’s exactly what you’d expect).
While earlier plans of a $25,000 “Tesla Model 2” were scrapped last year, the notional cheap Tesla still remains a popular discussion topic. Now, thanks to the company’s latest earnings call Wednesday, we have a better idea of what to expect — namely that a cheap entry-level model is in the works. Sort of.
In fact, CEO Elon Musk mentioned exactly what this car will be: “It’s just a Model Y.”
Confused? Well, what we’re basically looking at in a few months’ time is a stripped-down version of the existing and recently revamped Model Y Juniper. Instead of paying $46,630 for a rear-wheel drive Long Range, though, this more basic version pulls out amenities for the sake of making the Y cheaper to build, and cheaper to buy.
Exactly which features Tesla plans to cut down remain to be seen, though the company says it started production of this model in June. Musk affirmed that timeline on the earnings call, so these cheaper Teslas will soon be available for public consumption. There’s just no word on what you’re missing against the existing Model Y, or exactly how much it will cost.
That said, you can make an educated guess where Tesla could delete some features to bring the price down. A smaller battery pack would be a pretty safe bet, while the cheaper Y could get less powerful motor(s), cloth seats, and remove some comfort items like dual wireless charging and the rear infotainment screen.
Odds are, the stripped-down Tesla Model Y could land somewhere in the mid-$30,000 range, before tax incentives. And speaking of incentives, buyers may not have long to jump on truly snagging a cheap Tesla, as the $7,500 federal tax credit evaporates after September 30 (though states may still keep their incentives in place).
We’ll keep an eye out for more details in the coming months, including how Tesla’s financials shake out with the looming end of the federal tax credit. The fallout from that shift won’t be evident until the end of the year, but the September 30 deadline may spur some people to pull the trigger on buying a Tesla, or another eligible EV, so automakers could see a short-term surge from people taking advantage of the $7,500 credit while they still can.
