Tesla is gearing up to release its most affordable electric vehicle yet, the Model 2, with a targeted base price of $25,000. According to recent comments from Tesla CEO Elon Musk this budget EV could arrive sooner than expected. Gary Black, managing partner at Future Fund believe as early as late 2024. That would put major pressure on legacy automakers trying to transition to electric.
Musk has indicated the Model 2 is far along in development, with production plans at Tesla’s new Gigafactory in Texas being reviewed weekly. He has emphasized that the manufacturing techniques will be unique and revolutionary in the auto industry. The more efficient production will help Tesla offset the lower margins of a $25,000 car.
Hitting that aggressive price point is key to unlocking a much bigger market for EVs. Up until now, many average car buyers have been priced out of the EV revolution. The Model 2 would make an electric option accessible to a wider range of consumers and greatly accelerate the demise of gas-powered cars.
Getting to market by end of 2024 would put major pressure on legacy automakers who are slowly transitioning their fleets to electric. As regulations tighten and gas car bans start kicking in, the affordable Model 2 could be perfectly timed to swoop in and capture massive market share from lagging competitors. If Tesla can achieve this while maintaining strong quality, it will cement EV domination.