Tesla CEO Elon Musk in 2022 introduced plans for a next-generation platform that might enable the corporate to launch electrical automobiles smaller than the Mannequin 3 and Mannequin Y, and with lower cost factors. Nonetheless, he did not announce timing.

Citing 4 individuals acquainted with the matter, Reuters reported on Wednesday that Tesla has advised suppliers it needs to start out manufacturing of a car primarily based on the next-generation platform in mid-2025. Two of the individuals described the car, which is code-named Redwood, as a compact crossover.

Musk in 2020 stated Tesla’s next-generation platform would allow the corporate to introduce a car priced from $25,000, although it is not clear whether or not that’s the identical car talked about within the Reuters report.

A separate supply advised Reuters that Tesla reversed engineered a Honda Civic a number of years in the past to review easy methods to construct inexpensive automobiles. The compact Honda begins at about $24,000.

The Mannequin 3 is essentially the most inexpensive Tesla at present on sale and is priced at virtually $40,000 in base trim.

Musk has additionally beforehand stated that Tesla is planning at the very least two automobiles on its next-generation platform. On the Cybertruck launch final fall, Musk stated manufacturing of automobiles primarily based on the next-generation platform would begin at Tesla’s plant close to Austin, Texas. A second manufacturing location could also be a brand new plant in Mexico that Tesla introduced final 12 months.

Tesla is beginning to face stiff competitors from rival EV producers, significantly in China the place quite a few corporations provide EVs with a lot lower cost tags than what Tesla costs. A kind of corporations is BYD, which overtook Tesla because the world’s prime EV producer within the last quarter of 2023, delivering 526,409 items versus Tesla’s tally of 484,507 items.