Citing anonymous sources familiar with the project, Reuters reported Thursday that Tesla is developing a new compact SUV model that would be priced below its other electric vehicles, including the $36,990 Model 3.
It’s too early to say whether the project will make it to the production stage or what the timeline might be for such a vehicle. But if true, it indicates that the company would be looking to expand its portfolio with an eye toward addressing pricing pressures and increased competition in the EV market. Chinese companies such as BYD have made global strides in quickly developing inexpensive EVs that have challenged the world’s top EV makers abroad.
A representative for Tesla did not immediately respond to a request for comment.
According to the report, production of a new Tesla vehicle might be done in China, with some expanded production in the US and Europe. It would be smaller than Tesla’s Model Y SUV.
Tesla CEO Elon Musk was previously said to be pivoting away from plans for a low-cost EV in the $25,000 range a few years ago, but the latest report suggests this new car may lean more heavily into autonomous driving technology while also reviving the original project. This vehicle could offer a human driving option to wait out regulatory issues over autonomous cars while still having self-driving as its core technology.
A new US EV company, Slate Auto, recently announced plans to make an electric truck that would sell for around $25,000. The company is partially backed by Amazon founder Jeff Bezos.
In recent years, Tesla has been more focused on developing robots and autonomous taxi services.