New York (TIP): Tesla Inc. is said to be working on an all-new smaller and cheaper electric car—a compact SUV—as the company led by the world’s richest person looks to regain the bragging rights of being the world’s No.1 EV maker. The Austin, Texas-based company has contacted suppliers in recent weeks to discuss details of the plan for the Compact SUV, which would be a new vehicle and not a variant of Tesla’s current Model 3 or Y, four people aware of the development told Reuters. The conversations involved the manufacturing process and specifications for various components, they said.
Three of the people said the Compact SUV would be produced in China, and one said Tesla also aims to expand production to the United States and Europe. The car would be 4.28 metres in length, at least two people said. That’s significantly shorter than Tesla’s top-selling Model Y SUV, which is about 4.8 metres long.
The effort follows a decision by Chief Executive Officer Elon Musk to scrap a highly anticipated low-cost EV project in 2024 and pivot the company to focus on robotaxis and humanoid robots. A key question is whether this latest effort to develop a smaller SUV signals a strategy shift back to mass-market, human-driven EVs or whether the new model would align more with Tesla’s vision for fully autonomous vehicles. Such a model could potentially serve both purposes, according to one of the people familiar with the new project and a Tesla employee with knowledge of its current product philosophy. The Tesla employee declined to confirm or deny details of any specific vehicle but said, in general, the automaker now aims to build models that would be driverless but offer a human-driven option. While aiming for full autonomy across its lineup, the person said, Tesla realises many global markets won’t see meaningful adoption—nor regulatory acceptance—of driverless vehicles for years.
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