Tesla’s New Small EV Replaces Canceled Model 2
▼ Summary
– Tesla has discontinued its Models S and X to reallocate factory space for the production of humanoid robots.
– The company currently sells only two car models in most markets, as Cybertruck sales are struggling.
– According to a Reuters report, Tesla is developing a new, smaller, and cheaper all-electric vehicle.
– This new EV is a distinct design, significantly shorter than the current Model 3 or Model Y.
– The vehicle is initially planned for production in China, which would subject US imports to a 100% tariff.
For years, Tesla has maintained a dominant market position with a surprisingly limited vehicle lineup. This strategy is poised for a potential shift, according to a new report. Sources indicate the company is actively developing a new, more affordable electric vehicle, a move that follows its recent discontinuation of the Models S and X to reallocate factory resources. Those resources are reportedly being directed toward CEO Elon Musk’s ambitious vision for large-scale humanoid robot production. Currently, Tesla effectively sells just two core models globally, given the sluggish Cybertruck sales in the US, making this rumored compact car a significant strategic development.
The information comes from a Reuters report citing four anonymous sources within Tesla’s supply chain. These individuals claim the project is an all-new vehicle design, not a derivative of the existing Model 3 or Model Y platform. Specifications suggest a notably smaller footprint, with a length of approximately 168 inches (4.3 meters). This makes it substantially shorter than the Model 3 (185.8 inches) and the Model Y (188.7 inches), positioning it as a truly compact offering.
However, prospective buyers, particularly in North America, may need to temper their enthusiasm. A major hurdle involves manufacturing and tariffs. Three of the sources stated that initial production for this new smaller, cheaper EV is planned for China. Importing vehicles from China to the United States would trigger a 100 percent tariff, a rare trade policy area of alignment between the current Biden administration and the prior Trump administration. This cost barrier could severely limit or delay the model’s availability in the US market. A fourth source suggested that production could potentially be added at Tesla’s facilities in the United States and Germany at a later stage, which would circumvent the tariff issue.
(Source: Ars Technica)
