Tesla Postpones Launch of More Affordable Model Y: Report

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      If you're on the hunt for an affordable Tesla, don’t hold out for a new entry-level Model Y. A recent report indicates that Tesla's much-anticipated plan for "more affordable models" has been delayed by several months.

      The Tesla Model Y, recognized as the best-selling car globally in 2023 and 2024, received a significant update for 2025, referred to as "Juniper." This refresh included changes to the exterior design, added technology, and enhanced performance. However, the Long Range All-Wheel Drive version, which is the only one currently available, starts at $50,630 before any potential EV credits. But, weren't we expecting a $25,000 Tesla by now?

      According to Reuters, the lower-cost Model Y was initially set to begin production in the first half of this year. Nevertheless, as is common with Tesla, plans and commitments are subject to change. Now, the start of U.S. production for the budget Model Y (internally designated as E41) is projected to commence between the third quarter of 2025 and early 2026.

      Despite the shifting timeline, sources familiar with the project revealed to Reuters that the company aims to manufacture 250,000 units of the E41 Model Y in 2026, specifically for the U.S. market. In 2024, Tesla produced nearly 1.68 million Model 3 and Model Y vehicles.

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      Currently, the final price remains uncertain, much like the production schedule. The notion of a $25,000 Tesla has been floated around, retracted, and rumored back into being. Interestingly, a Tesla priced at $25,000 was available through Hertz, with prices dipping as low as $14,000.

      If the E41 is indeed smaller and has 20% lower manufacturing costs than the standard Model Y Juniper, as reported by Reuters, then a Model Y priced similarly to the current Model 3 could be more feasible. Insiders also mentioned that a basic version of the Model 3 is under development, which might be the best opportunity for an affordable Tesla EV outside a rental agency sale.

      The E41 Model Y is also set to launch in China and Europe, with the European rollout timing still unannounced, but the Chinese market is expected to see it in 2026. Ongoing automotive tariffs could impact this timeline; for instance, shipments of components sourced from China for the Cybercab and Semi have recently been halted.

      Naturally, Tesla investors are eager for the less expensive models to go into production sooner rather than later. Perhaps a budget-friendly EV with advanced technology and performance could rejuvenate sluggish sales, or it might just be optimistic speculation.