Tesla Model 2 production cost will be under $20,000

Although the rumors have been going on for longer than the project itself, in recent weeks what seems to be one of the great movements of Tesla in the coming years has gained strength. A new model will be placed below the Model 3 due to size and price, and that will become the cheapest alternative of the brand.

Elon Musk himself added fuel to the fire by indicating a few weeks ago at an event with investors that they were preparing a new platform on which the economic model will be based. A smaller architecture that will be the third after those of the Model S/X and Model 3/Y, and which, according to Musk, will stand out for having a production cost 50% lower than the current ones.

Now the specialized newspaper The Detroit Bureau has given new details of this project, and where it highlights that Tesla is aiming to reduce the cost of production below 20,000 dollars. Something that would allow it to be achieved, not only meet the challenge of a model for less than $35,000 but even approach that of $25,000.

Of course, we are talking about prices in the United States, and estimates by the newspaper. Estimated costs to which in Europe we would have to add taxes. But despite this, if achieved, Tesla could hit the table definitively by fully entering a very popular volume segment.

To achieve this, in addition to the new platform, Tesla could also achieve lower costs by using alternatives such as replicating the production process with large castings that it is beginning to apply to the Model Y, which simplifies and cheapens the process. There would also be the use of lithium-ferrophosphate batteries, which have managed to lower their cost even more than the NCM.

tesla model 2

According to The Detroit Bureau, this would allow Tesla to produce a cheap but profitable electric car. A proposal with a smaller margin than the current Model 3 or Model Y, but that will compensate for it with a much larger volume.

An affordable model can also serve Tesla to attract new customers, who can then keep moving to more expensive alternatives within the brand itself, taking advantage of the high level of loyalty it is achieving.

According to the latest statistics compiled by the Automotive News portal, customer loyalty at Tesla increased by around 4% from March 2021 to April 2022 compared to the previous year and it is indicated that 62.2% of customers who had a Model 3 opted for the same car again between March 2021 and April 2022.

A key aspect that could help Tesla improve its economy of scale, but also in the medium term to increase its general sales among all its proposals, and not only with the new economic model. Something that would earn you points to speed up your throw.

The big question is when. According to The Detroit Bureau, the arrival of the Tesla Model 2, a provisional name, will not occur until at least 2024 at the earliest. Something that will depend on many factors, mainly the availability of batteries to meet foreseeable high demand.

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