Tesla has plans to release an affordable new car next year.
CEO Elon Musk said that the company will start production of a new EV at its Texas factory in the second half of 2025 on a post-earnings call, according to Digital Trends.
Reuters reported that the vehicle, codenamed "Redwood," would be a compact crossover, and that after production launches in Texas, it will also be produced in Mexico and outside of North America.
The outlet also reported that the entry-level model for the more planet-friendly vehicle may be as cheap as $25,000 (and there will be at least two models), meaning that the company could compete with both inexpensive gas-powered cars and other affordable EVs.
Musk had previously said that Tesla would build a $25,000 EV in 2020, per Reuters. The company's current cheapest model, the Model 3, costs a whopping $38,990.
"I'm often optimistic regarding time. But our current schedule shows that we will start production towards the end of 2025," Musk told the outlet of the new timeline for the Redwood. "We'll be sleeping on the line practically."
However, another source said that it may take longer for the Redwood to materialize.
"They have been overly optimistic on most of their new product launches. Volume output is more likely to begin in 2026," the source told Reuters.
The company is also aiming to produce a self-driving taxi, which would use the same basic architecture as the Redwood.
"Both the design of the products and manufacturing techniques are head and shoulders above anything else that is present in the industry," Musk told shareholders.
Tesla's most recent new vehicle was the Cybertruck, which debuted late last year. The massive new electric pickup truck has won over onlookers who witnessed its durable offroading power, futuristic automatic tonneau cover opening, and impressive rapid acceleration capacity.
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