Tesla has reportedly informed suppliers of its intention to commence production of a new mass-market electric vehicle, codenamed “Redwood,” by mid-2025. This information comes from four individuals familiar with the matter, with two of them describing the model as a compact crossover, reports Reuters.
Tesla CEO Elon Musk has long expressed interest in making affordable electric vehicles and self-driving robotaxis on new, cost-effective electric car platforms. These models, including a $25,000 entry-level car, aim to compete with more affordable gasoline-powered vehicles and inexpensive EVs like those produced by China’s BYD.
Tesla sent out “requests for quotes” for the “Redwood” model to suppliers last year, projecting a weekly production volume of 10,000 vehicles, according to two sources. The production is slated to begin in June 2025, as stated by three of the sources, who spoke on the condition of anonymity due to the confidential nature of the matter.
Investors have shown significant interest in Tesla’s next-generation compact vehicles, a topic that was among the most voted questions ahead of Tesla’s quarterly results report. The company is expected to forecast a 21% rise in 2024 deliveries, falling short of Musk’s long-term annual target of 50% growth set about three years ago.
At Tesla’s annual shareholder meeting, Musk mentioned working on two new products with a potential combined sales target of 5 million vehicles a year. He described both the design and manufacturing techniques as superior to anything else in the industry. Walter Isaacson’s biography of Musk, released in September, reveals plans for an inexpensive robotaxi and a $25,000 entry-level electric car based on the same vehicle architecture.
One source suggested that volume output for the new model is more likely to begin in 2026. Musk previously indicated that the affordable model would initially be manufactured at Tesla’s Texas factory.
Tesla reportedly disassembled a Honda Civic, priced starting at $23,950 in the U.S., to study methods for manufacturing cheaper cars. The “NV9X,” Tesla’s next-generation architecture, is expected to include two or more models.
Take this report with a grain of salt. But it’s clear Tesla’s next-gen plans are underway to bring a mass-market EV to the masses using next-generation manufacturing. The machine that builds the machine continues to get more efficient, reducing costs for Tesla to build its vehicles. This a major advantage Tesla has over traditional auto, as its manufacturing efficiency continues to evolve at a fast pace.
