Tesla to start production of new electric vehicles by mid-2025

Tesla is set to revolutionise the electric vehicle (EV) market with its ambitious "Redwood" project, aiming for mass-market penetration by mid-2025, as reported by Reuters in an exclusive report.

Tesla CEO Elon Muskhas long been vocal about introducing affordable electric vehicles and self-driving robotaxis.

The realisation of these goals hinges on next-gen, cost-effective electric car platforms that align with Musk's vision of making sustainable transportation accessible to the masses.

Challenges amidst BYD's triumph

Despite Musk's initial promise of a $25,000 car in 2020, Tesla faced setbacks, eventually prompting a revival of the plan.

Meanwhile, China's BYD overtook Tesla as the leading EV maker in the last quarter of 2023. With the Model 3 sedan priced at $38,990, Tesla confronts the imperative to narrow the price gap for wider market adoption.

Tesla kicked off the Redwood project by soliciting "requests for quotes" from suppliers last year, projecting a weekly production volume of 10,000 vehicles. Production is slated to commence in June 2025, marking a significant leap toward Tesla's goal of expanding its footprint in the mass-market EV segment.

As Tesla gears up for its quarterly results, investor attention is keenly focused on the timing of next-gen compact vehicles. Musk, addressing concerns about consumer demand in the face of high-interest rates, has assured stakeholders that the Redwood model's design and manufacturing techniques surpass industry benchmarks.

Musk has unveiled plans for two groundbreaking products, with a combined sales potential of 5 million vehicles annually. This includes an affordable robotaxi and an entry-level $25,000 electric car, both sharing a common vehicle architecture. Walter Isaacson's biography of Musk sheds light on Tesla's bold vision for reshaping the EV landscape.

Tesla's history of missing launch targets and pricing challenges is evident, with the Cybertruck experiencing delays and a 50 per centhike in its initially touted starting price.

To glean insights into cost-effective production, Tesla dissected a Honda Civic, priced at $23,950 in the US, demonstrating a meticulous approach to achieving affordability.

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Beyond the Redwood project, Tesla's next-gen architecture, internally named "NV9X," is poised to include multiple models.

The company envisions manufacturing more affordable cars in Berlin and is exploring the possibility of a factory in India. With existing facilities in Shanghai and Fremont, California, Tesla strategically positions itself for the global shift towards accessible electric mobility.

(With inputs from agencies)