In a recent earnings call, Tesla CEO Elon Musk delivered disappointing news to those eagerly anticipating an affordable Tesla model priced at $25,000. Musk confirmed that such a drivable vehicle is not on the horizon, leaving many potential buyers frustrated. The company’s future plans for an affordable Tesla now hinge on its ability to achieve Level 5 autonomy, a technology that still faces significant technical and regulatory challenges.
Musk and Tesla have been hinting at the possibility of a $25,000 production model, often referred to as the “Model 2,” since at least 2018. However, despite ongoing discussions and expectations, the company has yet to produce a vehicle close to that price point, with current models mostly relying on substantial tax rebates to lower costs. During the earnings call, Musk was asked directly about the timeline for a $25,000 non-Robotaxi model. His response was revealing, as he stammered through his answer before ultimately stating, “I think we’ve been very clear that the future is autonomous.”
The Shift Toward Autonomy
Musk elaborated on his vision for the future, emphasizing that autonomy is at the core of Tesla’s strategy. He pointed to the upcoming Cybercab—a fully autonomous production vehicle—as a revolutionary step for the company. However, when pressed about the feasibility of a conventional $25,000 model, Musk declared, “Basically, having a regular 25K model is pointless. It would be silly. It would be completely at odds with what we believe.”
This marks a stark departure from his comments during Tesla’s Battery Day in 2020, when he optimistically projected that the company could deliver a compelling $25,000 electric vehicle within three years. He notably implied that this budget model would be fully autonomous, potentially lacking traditional controls like a steering wheel or pedals. At the time, he did not mention the challenges of actually bringing such a vehicle to market.
The Roadblocks Ahead
Musk’s current reasoning suggests that developing a drivable model would detract from Tesla’s efforts to create a dedicated autonomous vehicle. This perspective raises concerns about the timeline for delivering a budget-friendly option, as many experts believe Level 5 autonomy—where a vehicle can drive itself under all conditions—is still a decade away. Even if Tesla makes significant strides in this area, it will still need to navigate a complex regulatory landscape to gain approval for fully autonomous vehicles.
This isn’t the first time Musk has made ambitious claims about an affordable Tesla. In 2018, he told tech reviewer Marques Brownlee that a $25,000 vehicle was feasible within three years if Tesla worked hard. Yet here we are six years later, and there remains no clear path to such a model.
With the pandemic causing delays and various production challenges, it begs the question of why Tesla continues to develop models like the Roadster, especially when Musk asserts that “autonomy is the future.” A supercar without conventional controls raises doubts about its market appeal, especially when consumers are looking for affordability and practicality in electric vehicles.
As Tesla’s trajectory continues to focus on autonomous technology, potential buyers of an affordable Tesla will have to wait, uncertain about when—or if—such a vehicle will ever become a reality. The ambitious goal of Level 5 autonomy remains a significant hurdle for Musk and Tesla, pushing the timeline for an accessible electric vehicle further into the future.
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