EV giant Tesla, which has been struggling with sales in recent months, is expected to unveil on Tuesday a more affordable version of its best-selling Model Y SUV, as it seeks to reverse the negative trend and waning market share amid rising global competition.
CEO Elon Musk has for years promised mass market vehicles, though last year he canceled plans to build an all-new $25,000 EV, Reuters first reported.
The car expected this week is an "affordable" vehicle based on current manufacturing and design platforms.
Tesla posted two clips on X over the weekend, igniting excitement among Tesla fans. One video shows headlights peering out of the darkness, and another shows what appears to be a wheel spinning for a few seconds, followed by "10/7," the U.S. format for the date Oct. 7.
Neither Tesla nor influencers have indicated that an in-person event is planned, unlike previous major Tesla launches.
Still, analysts, investors and fans expect the company to make some announcement. Major questions include the car's price, driving range and efforts to strip down costs.
Late last year, Musk said the vehicle would be priced below the "key threshold" of $30,000, including U.S. EV tax credits. In the U.S., prices effectively rose by $7,500 at the end of last month, when the credit ended. That helped goose quarterly sales to a record, but expectations are that they will slow down for the rest of the year, unless the affordable car comes to the rescue.
"The desire to buy the car is very high. (It's) just (that) people don't have enough money in the bank account to buy it," Musk said in July during Tesla's second-quarter earnings call. "So the more affordable we can make the car, the better."
Musk initially promised that production of the vehicle would start by the end of June. However, Tesla only produced what it called "first builds" of the car, which it announced in July, adding that it would be available to customers sometime in the last three months of the year.
Tesla has already been grappling with slowing sales of its aging lineup as competition has grown rapidly, especially in China and Europe, where Musk's far-right political views have also undermined brand loyalty.
Earlier this year, Tesla introduced a refreshed version of the Model Y, featuring improvements such as new light bars and a rear touchscreen.
Musk has been pivoting the company toward artificial intelligence, with a focus on robotaxis and humanoid robots.
Tesla has announced that it will introduce more affordable vehicles to its lineup, but has not provided specific details. Sources have told Reuters the EV maker also plans to roll out a stripped-down version of its Model 3 midsize sedan.
Affordable cars will also be key to Tesla delivering 20 million vehicles over the next decade – one of the several operational and valuation milestones set by the company's board as part of its proposed $1 trillion pay package for Musk.
