Tesla says it plans to launch a 'more affordable' car in 2025

It’s happening—albeit a bit later than initially expected. On Wednesday, Tesla held its Q3 2024 earnings call, revealing strong financial results: revenue grew by 8% and earnings by 17% year-over-year. The company’s energy generation and storage business saw exceptional growth, with a 52% increase. While quarterly deliveries totaled 470,000—slightly below expectations—Tesla’s profitability rose, offsetting the lower delivery numbers.

Following the somewhat underwhelming "We, Robot" event, where Tesla unveiled a robotaxi, robovan, and a robot that won’t hit the market for years, the big question remained: When will the company release that more affordable car it promised some time ago? The short answer is: We don’t yet know exactly what will be launched. However, we do have a clearer idea of when. Tesla stated in its earnings report that "preparations are underway for our offering of new vehicles—including more affordable models—which we will begin launching in the first half of 2025."

While this is vague — we don't know how many new models are coming, and which one of them will come first — it gives hope that the company will launch a more affordable Tesla (perhaps the rumored Model 2) fairly soon.

Tesla offered a bit more insight during the call. A company representative shared, "As Elon and Vaibhav mentioned, our plan is to meet that goal in the first half of next year. Our mission has always been to reduce the cost of our vehicles to drive the adoption of sustainable energy and transport. Part of that effort includes lowering costs for current vehicles." CEO Elon Musk then chimed in, discussing the Robotaxi (CyberCab), which he said will cost "30k" "with incentive."

When asked for clarification on when Tesla plans to launch the "$25,000 non-robotaxi regular car model," Musk shifted focus to the future of "autonomous electric vehicles." He dismissed the idea of a regular $25K model, calling it "pointless." "It would be silly. It would be completely at odds with what we believe," he said.

It sure appears he was talking about the Robotaxi, as he reiterated: "What we designed is optimized for autonomy. It will cost on the order of — cost roughly 25K, so it is a 25K car. And you can — you will be able to buy one exclusively if you want. So, it just won't have steering wheels and pedals."

(Do note that Elon is contradicting himself by saying the CyberCab (Robotaxi) will cost $25,000 after claiming it will cost $30,000 with incentives (so, roughly $37,000) just minutes ago).

All of this leaves a lot of uncertainty about what exactly Tesla will launch in the "first half of 2025." While the company plans to roll out the Robotaxi "before 2027," it won’t happen any sooner than 2026. Will existing models become cheaper? Will a "more affordable" new Tesla be introduced, priced above $25,000 but still under the cheapest Model 3 at $42,490 before incentives? Or could it be a stripped-down version of the Model 3 or Model Y? We’ll have to wait and see.