The only $25,000 Tesla we’ll ever see is the Cybercab

For years, Tesla enthusiasts and budget-conscious EV shoppers have waited for the rumored $25,000 Tesla. Would it be a compact hatchback? A stripped-down Model 3? The speculation ran wild. However, recent comments from Tesla CEO Elon Musk have poured cold water on those dreams. The $25,000 Tesla is indeed coming, but not in the form anyone expected. Forget steering wheels and pedals. This Tesla is designed to drive itself.

During Tesla's third-quarter earnings call, Musk declared that a traditional $25,000 car would be "pointless" and "silly." Instead, the company's upcoming Cybercab, an autonomous robotaxi, will fill that price point. First unveiled earlier this month, the Cybercab is a radical departure from conventional vehicles. With no traditional driver controls and a two-seater design, it's purpose-built for autonomous ride-hailing services.

Musk's unwavering faith in autonomous technology is no secret. Its importance to Tesla's future became a mantra, often at the expense of addressing the demand for more affordable, driver-oriented EVs. This laser focus on self-driving technology has left many industry analysts scratching their heads. While Tesla continues to dominate the luxury EV market, its limited lineup leaves a gaping hole in the rapidly expanding market for affordable electric cars.

This strategic gap has allowed competitors to capitalize on the growing demand for budget-friendly EVs. General Motors recently launched the Chevy Equinox EV, a compact SUV with a starting price of around $27,500 (after tax credits), positioning it as a direct competitor to the long-awaited, but never realized, $25,000 Tesla car.

Despite the market opportunity, Musk seems unfazed. He envisions a future where Cybercabs rule the roads, predicting a staggering production volume of 2 to 4 million units per year. This ambitious goal would make the Cybercab the highest-volume vehicle in history, surpassing even the iconic Ford Model T. However, achieving this vision hinges on Tesla's ability to perfect its self-driving technology and gain public trust in autonomous vehicles.

While the Cybercab steals the spotlight, Tesla has also hinted at plans for more affordable EVs in the pipeline. The company's third-quarter earnings report confirms production of cheaper vehicles will commence in the first half of 2025. Details remain scarce, leaving potential buyers to wonder if these will be stripped-down versions of existing models or entirely new designs.

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