Tesla axes new Model 2, but promises cheaper cars
STORY: Tesla appears to have axed plans for a cheaper model that was set to cost around $25,000.
That tallies with earlier Reuters reports that boss Elon Musk has cancelled the all-new Model 2.
At the time he posted on X that “Reuters is lying”, but failed to point out any inaccuracies in the report.
On Tuesday the EV maker said it would introduce cheaper new models early in 2025.
But details on the products were in short supply.
Musk wouldn’t say whether they would be all-new, or updates of existing vehicles.
Tesla said the models would use “aspects” of current platforms.
It warned that cost reductions might not be as great as under previous plans - suggesting any new cars won’t hit the $25,000 starting price that Musk has long promised.
Even so, the news sent Tesla shares sharply higher in after-hours trade, gaining as much as 12.5%.
The stock had seen months of declines amid signs of rising competition and falling sales.
On Tuesday, Tesla also promised to unveil an advanced robotaxi, without saying when.
Musk says the firm should really be viewed as an AI robotics firm as a result - not as a carmaker.
The news all came as Tesla reported a fall in quarterly revenue for the first time since 2020.
It sank to $21.3 billion over the three months ended March - worse than analysts expected and about $2 billion down on a year earlier.
Revenue per vehicle also fell, as a result of repeated price cuts, with net profits cut by more than a half in consequence.
Tesla recently said it would lay off more than 10% of its workforce amid waning demand.
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