Tesla Scraps Entry-Level Model 2 Project
New Delhi: In a surprising turn of events, the long-awaited entry-level Tesla Model 2 EV project has been canceled, according to a Reuters report. The Model 2, which was expected to be priced under GBP 25,000 (roughly Rs. 26 lakh), was set to compete with electric vehicles like the Volkswagen ID 2, Renault 5 and MG 4 EV.
Although Tesla has not officially commented on the report, sources familiar with the matter and internal messages from the company suggest that the project has indeed been abandoned. Furthermore, the platform originally built for the Model 2 will now be used for a range of autonomous robotaxis, albeit in much lower production volumes.
Tesla CEO Elon Musk responded to the report with a post on his social media platform X saying, “Reuters is dying.”
Tesla previously hinted at plans for a new car below the Model 3 sedan and Model Y crossover. However, details about its condition and specifications were limited until now. The company also released a shadowy teaser image of its silhouette, which hints at a smaller version of the Model 3.
A key aspect of the Model 2’s feasibility was a new production process called Unboxed, which aimed to streamline manufacturing by reducing unnecessary movement or disassembly of the car or its components during production. However, with the project coming to an end, this innovative production process and platform will now be reused for Tesla’s autonomous ride-hailing vehicle.
While initial production of the Model 2 was planned for Germany, Tesla’s recent focus has turned to its India plans. The Indian government’s approval of a policy to attract investment in the EV sector has opened up opportunities for Tesla, which has been lobbying for lower import duties for years. Currently, Tesla is actively looking for locations for a manufacturing plant in India.
The decision to abandon the Model 2 project underscores Tesla’s evolving priorities and its commitment to innovation in the electric vehicle sector. As the company continues to expand its presence globally, especially in emerging markets like India, its strategic decisions will shape the future of the automotive industry.
