Yup. The Upcoming Tesla “Model 2” Breaks The Affordability Barrier.
Just a few short years ago, the thought of owning an electric vehicle was reserved for the rich. With prices in the astronomical range, the thought of owning one was a dream for the average buyer. Just the name Tesla conjured the images of a company exclusively producing luxurious electric vehicles. bFast forward, and today the company says it is gearing up to introduce a more budget-friendly model soon.
The big news: the (unofficially named) Model 2, is anticipated to be sold for around the same price point as the gas-powered Honda Civic.
The Math
According to reports, the “Model 2” is scheduled to debut in 2025 priced from $25K to $30K, making it one of the most competitively priced electric models to hit the U.S. market. According to Honda, the 2023 base Honda Civic hatchback starts at $24,750. But if the federal tax credit for electric vehicles is still in effect in 2025, buyers of the Tesla Model 2 could save up to $7,500 on their purchases. This would bring the effective price of the car down to as low as $17,500, making it even more affordable than the Honda Civic.
With Tesla’s Model 2 EVs are not “only for the rich.”
Tesla manufactures its more expensive vehicles in the U.S., and it is reported that the less expensive EV models will be produced at its forthcoming factory in Monterrey, (Mexico, with the possibility of additional production at its facility in Austin, Texas.).
Lars Moravy, Tesla’s vice president of vehicle engineering, noted that the use of larger, flat batteries that double as the car’s floor, could potentially streamline EV assembly and reduce costs by up to 65%.
There are some skeptics. Tesla’s ambitions to offer an affordable electric vehicle with impressive features and capabilities, some budget car manufacturers like Honda and Hyundai Motor Co. remain skeptical about the proposed price point. Hyundai, in particular, stated that achieving a $25,000 battery-powered EV without compromising driving range poses challenges, though it anticipates price parity between internal combustion engine and battery electric vehicle models eventually.
