Tesla is accelerating plans for a lineup of recent electrical automobiles, together with “more affordable models,” the automaker stated in a memo to buyers Tuesday. New fashions beforehand slated to start out manufacturing within the second half of 2025 will now launch earlier than then, the corporate stated, implying manufacturing will begin a lot earlier.
It’s unclear whether or not the brand new, reasonably priced fashions are the identical mysterious “next-gen” automobile that Tesla has beforehand hinted was within the works, or a new lineup. Executives declined to share particulars on their plans for brand new automobiles throughout an investor name Tuesday. Tesla’s inventory worth rose by greater than 9 % in after-hours buying and selling late Tuesday.
The change in plans comes after a troubled few months for Tesla, which has confronted a lag in US EV gross sales and the rising world dominance of Chinese rivals. Company outcomes launched right now confirmed that each automobile deliveries and whole income fell 9 % within the first three months of 2024 in comparison with the identical quarter final 12 months. That marks Tesla’s first drop in gross sales since pandemic-troubled 2020 and its largest fall in income year-on-year because the early aughts.
Tesla didn’t present particulars of the reasonably priced automobiles within the works or how a lot its plans have been pulled ahead. But it disclosed in Tuesday’s memo that to speed up manufacturing of recent fashions it’s going to in the reduction of its ambitions for brand new manufacturing expertise.
For years, CEO Elon Musk has touted the corporate’s path-breaking method to auto manufacturing. In 2023, he promised that its subsequent era of automobiles could be produced not by the traditional, Henry Ford-ian manufacturing line, however by a new, cheaper “unboxed” technique that might enable components to be assembled concurrently in several components of a manufacturing facility. Executives stated this new method would save the automaker labor and manufacturing prices.
The new automobiles slated for supply earlier than mid-2025 will as a substitute be produced on the identical manufacturing strains Tesla presently makes use of, the corporate stated Tuesday, utilizing a mixture of recent and older engineering strategies. That received’t minimize manufacturing prices as a lot as the broader manufacturing revamp, the automaker admitted, “but enables us to prudently grow our vehicle volumes … during uncertain times.”
The firm stated that its beforehand introduced future robotaxi automobile will nonetheless be constructed utilizing “a revolutionary ‘unboxed’ manufacturing strategy.” Musk debuted a new title for the longer term automobile on a name with buyers Tuesday, calling it a Cybercab.
This isn’t the primary time Tesla has scaled again grand manufacturing plans. In 2016, Musk introduced that Tesla’s Models 3 and Y could be constructed utilizing a totally automated manufacturing facility dubbed an “alien dreadnought.” But by 2018 it was clear that Tesla would maintain using people on its manufacturing strains. The ensuing chaos—which WIRED reported left staff to hold automobile components to their stations by hand—contributed to Tesla’s near-bankruptcy.
Reuters reported earlier this month that Tesla’s plans to construct a extra reasonably priced automobile had been canceled because the automaker pivoted to concentrate on constructing a robotaxi and improved autonomous driving merchandise. CEO Elon Musk disputed the story on X, however confirmed that Tesla would maintain a robotaxi unveiling occasion in August.
Last week, Tesla stated it could lay off some 10 % of its world workforce, and two high executives left the corporate. On Tuesday the corporate reported 1000’s of job losses to state companies in California, Texas, and New York. The automaker stated in Tuesday’s memo that it has additionally been affected by transport route shutdowns within the Red Sea throughout the Israel-Hamas battle, and by a suspected arson assault that introduced down its German manufacturing facility for days.
Also final week, the automaker recalled all 4,000 Cybertrucks it had beforehand delivered, after a cleaning soap used within the manufacturing course of allowed the pads on their accelerator pedals to turn into trapped.
Updated 6:50 pm EDT 4-23-2024: This article was up to date with further data from Tesla’s investor name.