Tesla has reportedly hit the brakes on plans to launch a low-cost version of its best-selling Model Y, just hours before the electric vehicle giant is set to announce its latest financial results. According to three sources familiar with the matter, the long-awaited affordable EV—originally slated for production in the United States—has now been shelved indefinitely.
While Tesla CEO Elon Musk has long promised a more budget-friendly electric car to accelerate EV adoption globally, insiders told Reuters that internal plans to roll out 250,000 cheaper Model Ys by 2026 are now on hold. The move comes amid uncertainty surrounding Tesla’s next steps for expansion in global markets, including China and its Berlin Gigafactory.
The exact reason for the delay remains unclear, but the timing raises questions as Tesla prepares to reveal its quarterly earnings, which analysts say will reflect recent shifts in strategy and demand trends. Industry watchers have noted that while Tesla continues to enhance in-car technology, its vehicle line-up has seen little diversification, drawing criticism from consumers and competitors alike.
Currently, the most affordable Tesla available to UK drivers is the Model 3, starting at just under £40,000, while the refreshed Model Y begins at £44,990, with deliveries expected in June. The postponement of a cheaper model may affect Tesla’s ability to tap into a broader customer base seeking more accessible EV options.
Analysts suggest this delay could be strategic, allowing Tesla to reassess cost structures, production efficiency, or emerging competition in the affordable EV segment.
With mounting pressure from legacy automakers and emerging startups launching competitively priced electric cars, the delay could either provide Tesla with breathing room—or further intensify calls for innovation in its product roadmap.
