Overview

• Tesla is reportedly developing a more affordable version of its Model Y, with production costs expected to be at least 20% lower than the current model.
• The new budget-friendly Model Y, codenamed 'E41,' is planned for mass production in 2026, with manufacturing in China, Europe, and North America.
• Elon Musk has emphasized that self-driving capabilities will be central to the design of the new model, dismissing the idea of a non-autonomous version.
• Tesla's sales in China, its second-largest market, have declined significantly, with February 2025 sales hitting a two-year low due to increased competition from local rivals like BYD and Xiaomi.
• Analysts suggest the introduction of an affordable model could help Tesla regain market share globally, as the company faces declining sales and political backlash in key regions.