Elon Musk's Tesla Inc. (NASDAQ:TSLA) has postponed the U.S. debut of an affordable version of its Model Y SUV.
The vehicle, internally known as E41, was initially set to launch in the first half of the year.
What Happened: Three sources with knowledge of the situation revealed that the production of this lower-cost Model Y in the U.S. is now expected to start several months later than Tesla’s public plan, according to a Reuters report on Friday.
The revised timeline suggests a start from the third quarter to early next year.
While the exact cause of the delay remains unclear, two sources indicated Tesla’s goal to manufacture 250,000 units of the cheaper Model Y in the U.S. by 2026. Plans also include eventual production in China and Europe.
The delay and production targets had not been disclosed before. Tesla’s upcoming earnings report on Tuesday is expected to address these plans.
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Why It Matters: The delay in launching the affordable Model Y comes amidst Tesla’s plans to introduce a Performance variant of the refreshed Model Y later this year, as stated by company executive Lars Moravy.
The refreshed Model Y, launched in January, is part of Tesla’s strategy to maintain its competitive edge in the electric vehicle market.
In March, Tesla offered significant discounts on the older Model Y versions, with reductions reaching up to $7,950, as the company prepared to deliver the refreshed variant. These discounts were seen as a move to clear inventory and make way for the new models.
Additionally, Tesla plans to refresh its premium Model S and Model X vehicles later this year, indicating a broader strategy to update its lineup and attract more customers.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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