Two years ago, Elon Musk told investors that building affordable electric cars for human drivers was, in his words, “pointless” and “silly.” Instead, his company would focus on the automated Cybercab and the profit model behind it.<\/p>\n
But Musk\u2019s decision firmness isn\u2019t his greatest quality. Reuters has reported that Tesla is backing off on that strategy and is returning to developing an entry-level model below the Model 3.<\/p>\n
Reuters gathered the info from four people familiar with the matter. These told the agency that Tesla has been working on an all-new compact electric SUV, which is smaller and cheaper than anything in its current lineup. To reduce costs, it will be manufactured at its Shanghai factory. Tesla itself did not respond when asked to comment.<\/p>\n
As for details, the sources shared that the vehicle would measure 4.2 meters in length, noticeably shorter than the Model Y’s 4.7 meters, and would shed some 500 kilograms. To achieve affordability, Tesla is believed to equip the car with a smaller battery pack, a single motor, and a reduced range.<\/p>\n
Manufacturing is reportedly not exclusively limited to Shanghai. The ambitions are to expand production to the United States and Europe in a later phase.<\/p>\n
The project, however, is still in early development. Automated driving is an active feature, with one source noting that the car is envisioned as “driverless but offering a human-driven option\u201d.<\/p>\n
Originally, the long-promised low-cost car from Tesla (codenamed NV9 and widely referred to as the Model 2) was canceled in favor of redirecting resources toward the Robotaxi program. Musk explicitly argued that the future of personal transport lay in autonomy, not in cheap cars for human drivers.<\/p>\n
What followed was an unusually public internal disagreement. News outlet Electrek reported that Musk had shut down an analysis prepared by the heads of Tesla’s vehicle programs, engineering, business development, and design teams. This analysis concluded that the Robotaxi would lose money and that the affordable EV should be prioritized. Musk overruled them.<\/p>\n
Subsequently, the affordable EV program was replaced with stripped-down variants of the existing Model 3 and Model Y, the Standard models. These landed far from the $25,000 target that had originally made the Model 2 program compelling. But it worked. After a steep drop, Tesla sales are rising again all over Europe.<\/p>\n
But while Tesla is recovering from its bruises, its position remains fragile. Competitors have not stood still. BYD and Leapmotor are offering EVs in the \u20ac20,000- \u20ac28,000 price bracket across China and Europe.<\/p>\n
They are following suit with new, accessible models like the Renault Twingo E-Tech and the VW ID. 3, as well as sister models like the Cupra Raval and the Skoda Epiq.\u00a0<\/span>Meanwhile, the Robotaxi operation in Austin, launched with considerable fanfare last year, still operates just a handful of vehicles in a limited geofence.<\/p>\n If the Reuters report is accurate \u2014 and bear in mind that this is the same agency that was accused of lying by Musk for reporting the Model 2 cancellation, but proved to be correct \u2014 then Tesla is quietly walking back on one of its most anticipated product launches.<\/p>\n The question now is whether Tesla can still compete at that price point by 2027 or 2028, when this vehicle could realistically arrive. Tesla has always been a pioneer in electric mobility, but now it is running late. Too little, too late?<\/p>\n","protected":false},"excerpt":{"rendered":" Two years ago, Elon Musk told investors that building affordable electric cars for human drivers was, in his words, “pointless” and “silly.” Instead, his company would focus on the automated Cybercab and the profit model behind it. But Musk\u2019s decision firmness isn\u2019t his greatest quality. Reuters has reported that Tesla is backing off on that […]<\/p>\n","protected":false},"author":715,"featured_media":184363,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2},"_wpas_customize_per_network":false,"jetpack_post_was_ever_published":false},"categories":[63,77160,77198,28,16,77169,8,4,77165,17],"tags":[],"class_list":["post-184361","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-autonomous-driving","category-china","category-concepts","category-europe","category-industry","category-market","category-product","category-top-stories-today","category-usa","category-weekly-newsletter"],"acf":[],"featured_image_urls_v2":{"full":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?fit=1536%2C1024&ssl=1",1536,1024,false],"thumbnail":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=150%2C150&ssl=1",150,150,true],"medium":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?fit=300%2C200&ssl=1",300,200,true],"medium_large":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?fit=640%2C427&ssl=1",640,427,true],"large":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?fit=640%2C427&ssl=1",640,427,true],"1536x1536":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?fit=1536%2C1024&ssl=1",1536,1024,true],"2048x2048":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?fit=1536%2C1024&ssl=1",1536,1024,true],"trp-custom-language-flag":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?fit=18%2C12&ssl=1",18,12,true],"related-thumb":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=640%2C480&ssl=1",640,480,true],"gform-image-choice-sm":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=300%2C300&ssl=1",300,300,true],"gform-image-choice-md":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=400%2C400&ssl=1",400,400,true],"gform-image-choice-lg":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=600%2C600&ssl=1",600,600,true],"mailchimp":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?fit=560%2C373&ssl=1",560,373,true],"unipress-phone":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=640%2C100&ssl=1",640,100,true],"unipress-tablet":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=1536%2C240&ssl=1",1536,240,true],"unipress-tablet-portrait":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=1536%2C180&ssl=1",1536,180,true],"unipress-tablet-landscape":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=1536%2C180&ssl=1",1536,180,true],"unipress-smartphone":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=1080%2C168&ssl=1",1080,168,true],"unipress-wide-screen":["https:\/\/i0.wp.com\/newmobility.news\/wp-content\/uploads\/2026\/04\/Tesla_SUV-model.png?resize=1536%2C180&ssl=1",1536,180,true]},"post_excerpt_stackable_v2":" Two years ago, Elon Musk told investors that building affordable electric cars for human drivers was, in his words, “pointless” and “silly.” Instead, his company would focus on the automated Cybercab and the profit model behind it. But Musk\u2019s decision firmness isn\u2019t his greatest quality. Reuters has reported that Tesla is backing off on that strategy and is returning to developing an entry-level model below the Model 3. From Shanghai Reuters gathered the info from four people familiar with the matter. These told the agency that Tesla has been working on an all-new compact electric SUV, which is smaller and…<\/p>\n","category_list_v2":"Autonomous driving<\/a>, China<\/a>, Concepts<\/a>, Europe<\/a>, Industry<\/a>, Market<\/a>, Product<\/a>, Top Stories Today<\/a>, USA<\/a>, Weekly Newsletter<\/a>","author_info_v2":{"name":"Piet Andries","url":"https:\/\/newmobility.news\/en\/author\/piet-andriesgmail-com\/"},"comments_num_v2":"0 comments","yoast_head":"\n