Tesla has abandoned plans to produce a mass-market model, Reuters reported, citing anonymous sources and company messages.
The reversal would abandon long-standing plans to offer a less expensive vehicle, as Tesla’s models are on the premium side of the market.
Convincing mass-market consumers to switch from gas to electric is a challenge the industry is grappling with as electric-vehicle sales haven’t met carmakers’ previously ambitious lineup transition plans. Consumers consistently cite EVs’ high prices as a major impediment to buying them.
Reuters said Tesla didn’t respond to a request for comment and that CEO Elon Musk later posted on his social media site X that Reuters “is lying again” without specifying what he referred to. The news agency said Tesla shares fell more than 6% after it publicized its report but regained some of the loss after Musk’s post.
The news agency pointed out that Tesla and other EV makers are facing stiff competition from China, which is shelling out models at inexpensive prices. Tesla already slashed prices on its existing models throughout 2023 to stay competitive with China and domestic carmakers.
