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Tesla Executives Challenge Musk’s Denial of $25,000 EV as Company Overhauls Strategy

Tesla prepares to introduce affordable Model 3, Model Y variants in early 2025 following its first annual sales downturn.

Tesla CEO Elon Musk attends the Saudi-U.S. Investment Forum, in Riyadh, Saudi Arabia, May 13, 2025. REUTERS/Hamad I Mohammed/File Photo
Tesla's Affordable EV Denials Sent The Company Into Shock: Critical Materials
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Overview

  • Elon Musk publicly denied canceling the $25,000 “Model 2” in April 2024 despite internal documents showing the project had ended weeks earlier.
  • Senior executives confronted Musk over his denial, warning it could mislead investors and potentially breach his SEC settlement.
  • Tesla has shifted focus to self-driving robotaxis and is developing stripped-down trims of its Model 3 and Model Y for rollout in 2025 with pricing yet to be disclosed.
  • The company posted its first annual vehicle sales decline in 2024 and recorded a 13% drop in first-quarter 2025 sales following intensified competition from Chinese automaker BYD.
  • Musk’s ongoing clashes with the media and regulators have heightened investor skepticism as Tesla grapples with a dated lineup and strategic uncertainty.