Musk says Tesla isn’t working on $25,000 EV, suggests robotaxis make it less important


Tesla CEO Elon Musk confirmed Wednesday that the electric-car maker is not currently working on its $25,000 EV and suggested that the availability of such a car doesn’t matter as much as when the car becomes autonomous.

Musk claimed that the actual cost of transit drops by a factor of four or five when autonomous vehicles are enabled: “It is clear from these questions that the gravity of full-self driving is not fully appreciated. If the asset has five times utilization, it’s like dividing the asset of that cost by five.” The argument is an autonomous car can be used to give rides when its owner doesn\’t need it, putting it in service five times as often.

Tesla has long held plans to offer more affordable vehicles. While previously that idea took form in a $35,000 version of the Tesla Model 3 that arrived for only a brief time, Musk explained at the company’s September 2020 Battery Day that it intended to deliver a “compelling” $25,000 car with fully autonomous driving capability in three years. 

$25,000 Tesla teased for 2023 – Battery Day

Later reports, citing the head of Tesla’s Chinese operations, Tom Zhu, confirmed in early 2021 that the affordable global EV will be developed in China, at a new R&D center in Shanghai. 

Nearly halfway through that development timeframe since the $25,000 model was announced, Musk clarified that the company isn’t working on it yet, although it will. 

In 2019, Musk revealed a plan to transform the company into an operator of self-driving “robo-taxis” capable of operating on the Tesla Network to earn money giving paid rides when owners don’t need them. At that time he promised “feature complete” full self-driving by the end of 2019 and operational autonomous cars at some locations in 2020. 

Consumer Reports Tesla Model 3 Navigate on Autopilot prepares to pass on left [CREDIT: CR]

Tesla’s Full Self Driving package, which now adds $12,000 to the price of new models, is an enhanced driver-assistance system, requiring the driver to monitor the road at all times. However Tesla is currently offering an expanded capability set called Full Self-Driving Beta to drivers qualified by a company-defined safety score. 

Wednesday’s update also included a confirmation that the Cybertruck, Roadster, and Semi are all delayed into 2023. “We have enough on our plate right now, quite frankly,” Musk said.


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