Tesla’s profitability could be about to go through the roof with the news that its next-generation EV platform should cost half as much to make as the current Model 3 and Model Y architecture.
CEO Elon Musk dropped that incredible nugget during Tesla’s Q3 2022 earnings call when asked by investors about the development of the company’s still-secret small EV. Obviously, not all of that 50 percent production cost saving will be passed on to the consumers, but it should mean Tesla will be able to bring a small car to market for around $30,000, or possibly less, and still turn a profit. The least expensive car in Tesla’s current lineup is the massively popular $46,990 single-motor Model 3, but the new car’s sales potential will put even that in the shade.
“It will, I think, certainly exceed the production of all other vehicles combined,” Musk said, but gave no indication when it might come to market. Autocar previously reported that the baby Tesla will offer a WLTP range of at least 250 miles (402 km) which will be higher than the base-spec VW ID.3’s (217 miles / 350 km) range.
The exterior design – previewed by an official sketch in 2020 seen at the top of this post – should bear a strong family resemblance to the Model 3’s, but will feature a hatchback rear end instead of a sedan trunk.
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Musk also seemed unconcerned about a global economic downturn, despite claiming in June that he had a “super bad feeling” about the economy. “We’re in a good spot,” he said, claiming that buyers realized it wasn’t smart to buy a combustion-powered car because the residuals would be poor next to those of electric rivals. “I wouldn’t say it’s recession-proof, but it’s recession resilient because the people of earth have in large part made the decision to move away from gasoline cars to electric cars.”
But it’s not just booming electric car sales that Musk thinks will help profits soar. He said Tesla would sustain a 50 percent annual growth rate averaged over several years, but the electric storage side of the business was forecast to grow at 150 to 200 percent annually.
H/T to Inside EVs