Work on Tesla’s cheapest electric car yet is “quite far advanced”

Elon Musk has confirmed work on Tesla’s new sub-US$25,000 (A$38,000) car is “quite far advanced”, with work on the new model getting closer to completion. In an interview with automotive engineer Sandy Munro, the Tesla CEO confirmed the affordable future model will begin production in the company’s Texas Gigafactory due to delays with the company’s Mexican plant. Mr Musk confirmed the new vehicle will still be built in Mexico, despite progress south of the border being slower than expected.

“It would take too long to complete the factory in Mexico,” the Tesla CEO told Mr Munro. As a result of Elon Musk’s comments, it’s unlikely the new model will make it into production at the Mexican plant by 2025, as a report by published on the social media site previously claimed. This recent confirmation comes as previous rumours suggesting some other candidates for production of the new vehicle could include Germany and India.

In early November, Elon Musk visited the Gigafactory Berlin-Brandenburg plant – which currently builds the Model Y for the European market – and reportedly announced the more affordable Tesla according to an X post by It’s entirely possible production of the forthcoming Tesla entry-level model could still be happening in these places as production at the Gigafactory Berlin-Brandenburg plant would reportedly be for the European market only. The new Tesla model could also be produced in more locations including China, where the Australian-specification and are currently manufactured. The rumours surrounding production in India have come as Elon Musk said Tesla would be “in India as soon as humanly possible” .

According to reports earlier this year, Indian-built versions of the new Tesla would be produced there for both that market as well as export markets. India is now the world’s third largest car market, though electric vehicles account for less than two per cent of overall sales there. Both vehicles and batteries could be manufactured in India.

Regardless of where this new more affordable Tesla will be built, Elon Musk promised “the revolution in manufacturing that will be represented by that car will blow people’s minds”. “It’s not like any car production line that anyone’s ever seen,” he said. The Tesla CEO added he “reviews the production line plans for that every week” – again suggesting development for the vehicle is no longer in its infancy.

While the shape of the new vehicle hasn’t been revealed, Tesla detailed at its 2023 investor day that the new production process . “Cost reductions don’t come from any one place… We have to go through everything,” said Tesla chief financial officer Zachary Kirkhorn. The company said further cost savings will be found in the robotaxi version of the next-gen model.

It says past Tesla vehicles were designed first, then engineered, then manufactured. But with the next-generation model, it wants to bring the design, engineering and manufacturing teams together at the beginning. As a result of streamlined production, Tesla claims operator density and space time efficiency will improve by 44 per cent and 30 per cent respectively.

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