Elon Musk Podcast Tesla’s new “affordable” Model Y and Model 3
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Oct 8, 2025 Tesla has launched new lower-priced trims for the Model Y and Model 3, priced around $37K to $40K, but many are disappointed they didn't hit the $25K mark. These trims include reduced features to cut costs, which may deter potential buyers. With fierce competition from brands like BYD and Hyundai, Tesla's strategy seems more about stabilizing sales than transformative innovation. The discussion highlights market pressures, the impact of canceling prior pricing plans, and how consumer expectations are shifting.
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Pricing Repackaging, Not Mass-Market Breakthrough
- Tesla introduced lower-trim Model 3 and Model Y priced around $37k–$40k, not the long-promised $25k car.
- The move appears aimed at reigniting sales quickly rather than delivering true mass-market affordability.
Feature Cuts Preserve Range, Not Investor Confidence
- The new trims cut premium features (manual mirrors, simpler seats) but keep ~300 miles of range to lower production cost.
- Investors saw the pricing move as tactical, causing a stock drop instead of signaling a product breakthrough.
Hit Sub-$30k Or Lose Mass Adoption
- If Tesla wants mass adoption, it must reach sub-$30k after incentives or build new manufacturing capacity to lower costs.
- Otherwise buyers will choose cheaper ICE or competitor EVs offering similar features at lower price points.