Tesla's 21/25 Update: Unveiling of the Erlking Model Y and Model S, Musk seeks expansion, and China's influence fortifying
**Tesla to Launch Affordable Electric Vehicles by June 2025**
In a significant move towards making electric vehicles (EVs) more accessible, Tesla has confirmed plans to release new affordable EVs by the end of June 2025. The announcement comes as the global EV market continues to grow, with Tesla's main competitor, BYD, recently surpassing the American company in Europe.
Tesla's Chief Financial Officer, Vaibhav Taneja, confirmed the production start for the new affordable EVs, which industry analysts suggest will resemble current Tesla models, particularly as a stripped-down or more compact variant of the Model Y. The aim is to leverage existing platforms to reduce costs, with potential pricing around $25,000–$30,000 after incentives.
The upcoming affordable cars, while rumoured to be the "Model 2" or "Model Q", have yet to receive official confirmation on the exact model name. However, it is clear that these vehicles will utilise a combination of Tesla's next-generation platform elements and aspects of the current platform, and will be produced alongside existing vehicle lines in Tesla’s factories.
While Tesla is also planning refreshed versions of other models like the Model Y Performance and Model 3, these are not classified as the new "affordable" entry-level EVs. Despite the planned launch, as of early July 2025, no official release or delivery information has been confirmed, and the timeline may have faced minor delays or remained uncertain.
Elon Musk, Tesla's CEO, has remained optimistic about the company's cheap EV plans, stating that increasing revenues through higher GDP is key to saving the US from financial collapse, rather than cutting spending. Musk has also hinted at a return to business due to US President Trump's plans to end the $7,500 tax credit for electric vehicle buyers in the US.
Meanwhile, Tesla is testing a suspected Model Y Performance on the German Nurburgring, featuring a larger rear spoiler, red brake calipers, and potentially a larger battery capacity. A camouflaged Model S Plaid has also been spotted on the Nurburgring, featuring an additional spoiler lip, new air intakes, a new diffuser, and possibly larger tires.
In the competitive EV market, Tesla faces challenges from Chinese companies like BYD, which has surpassed Tesla in Europe for the first time in April 2025, with a 169% increase in pure electric vehicle sales. Xiaomi, a Chinese company originally a smartphone manufacturer, has also introduced the Xiaomi YU7, an SUV that claims to outperform the Tesla Model Y in many ways.
As Tesla moves forward with its plans for affordable EVs, it remains to be seen how the company will navigate the competitive landscape and continue to push the boundaries of EV technology.
- Tesla's announcement to launch affordable electric vehicles by June 2025 will contribute to the growing global EV market, as it aims to make EVs more accessible and competitively priced with potential pricing around $25,000–$30,000 after incentives.
- The new affordable cars from Tesla will reportedly resemble current Tesla models and will leverage existing platforms to reduce costs, utilizing a combination of Tesla's next-generation platform elements and aspects of the current platform.
- While the exact model name of the upcoming affordable EVs is yet to be confirmed, they are expected to be produced alongside existing vehicle lines in Tesla’s factories, with industry analysts suggesting they will be a stripped-down or more compact variant of the Model Y.
- As Tesla focuses on developing affordable electric vehicles, it will face competition from other companies like BYD, which has surpassed Tesla in Europe for the first time in April 2025, and Chinese companies like Xiaomi, with the introduction of the Xiaomi YU7, an SUV challenging the Tesla Model Y in various ways.
- Tesla's strategy for increasing revenues on affordable electric vehicles is through higher GDP growth, rather than cutting spending, as stated by Elon Musk, the company's CEO, demonstrating a focus on business and outlook for a return due to US President Trump's plans to end the $7,500 tax credit for electric vehicle buyers in the US.
