Last month, a Chinese media outlet reported that Tesla was planning to restart the third phase of its Shanghai factory, possibly focusing on a $25,000 model.
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Tesla (NASDAQ: TSLA) has told suppliers it wants to start production of a new mass-market electric vehicle (EV) codenamed "Redwood" in mid-2025, Reuters said in a report today, citing four people familiar with the matter.
Two of them described the model as a compact crossover, according to the report.
Tesla CEO Elon Musk had promised to produce a $25,000 car in 2020, but he later shelved and then revived the plan, the report noted.
Tesla last year sent out a "request for quotes" or invitation to bid to suppliers for the "Redwood" model, and expects to produce 10,000 units per week, the report said, citing two sources.
Production will begin in June 2025, three sources said, according to the report.
Musk said last year that the affordable model would initially be built at Tesla's factory in Texas, the Reuters report noted.
Tesla tore down a Honda Civic -- which starts at $23,950 in the US -- in recent years to work on ways to build cheaper cars, the report said, citing two sources.
The next-generation Tesla architecture, known internally as the "NV9X," will include two or more models, according to the report.
Last month, a Chinese media outlet reported that Tesla was planning to restart the third phase of its Shanghai factory, possibly focusing on the $25,000 models.
Tesla began preparations for the construction of the Shanghai Phase III auto factory in 2021 and assembled a team, but paused the move in mid-2022, LatePost said in a December 6 story, citing a person close to the matter.
If it moves forward, the future production focus of the Shanghai Phase III plant could be on the $25,000-priced model Tesla teased in 2020, which would be key to Tesla's goal of reaching 20 million annual sales by 2030, LatePost's report said.
Tesla's current main sellers are the Model 3 and Model Y, which are considered high-end models in China due to their price tag of around 300,000 yuan ($41,810).
However, there is less room in that market than in the mass market, and BYD has quickly become the world's largest electric vehicle (EV) maker in the past two years by offering many models at different price points.
In the fourth quarter, BYD sold 526,409 passenger battery electric vehicles (BEVs), surpassing Tesla's 484,507 vehicles for the first time.
BYD also sold 416,242 passenger plug-in hybrids (PHEVs) in the fourth quarter. Tesla's models were all BEVs.
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