Costfoto / NurPhoto/ Getty Images
Key Takeaways
- Tesla is set to produce and launch a lower-cost Model Y vehicle in China likely in 2026, Reuters reported Friday—citing people with knowledge of the matter.
- The vehicle will also eventually be launched in Europe and North America, but Reuters' sources did not have a timeline for that launch.
- Tesla's sales in China have been pressured by a number of domestic competitors, with sales down a reported 50% year-over-year in February.
According to a report by Reuters published on Friday, Tesla (TSLA), is planning to sell a cheaper version of its Model Y in China beginning next year.
The news organization, citing three people with knowledge of the matter, reported that the vehicle will be mass produced in Tesla's China factory in 2026. It will likely cost at least 20% less to produce, retailing for less than the Model Y's current base price of 263,500 yuan ($36,405), Reuters reported.
Reuters cited a source anonymous who said that the lower-cost Model Y would eventually be launched in North America, Europe and Asia. However, they did not provide a timeline. Tesla did not respond immediately to a comment request.
Tesla has been working on a lower-cost electric car for years. CEO Elon Musk denied reports last year that Tesla had abandoned the project. Musk has said that Tesla will launch a lower cost EV by the first half of 2018. He has not, however, provided any details about a launch or price.
China’s electric vehicle market is becoming more competitive as a result of a growing number of domestic EV producers Growing and taking a portion of Tesla’s share. Tesla’s China sales fell by nearly 50% in February compared to the same period last year.
Tesla shares were trading around 2% higher in premarket Friday. They would need to increase their closing price by around 9% in order to finish the week on a higher note after a 15% fall Monday. Otherwise, they will have lost money for eight weeks.
