Tesla is set to unveil a more affordable version of its best-selling Model Y SUV in an effort to boost sales and recover its shrinking market share amid intensifying global competition. The new model, expected to be based on existing design and manufacturing platforms, aims to deliver mass-market accessibility without the need for a full redesign.
The announcement follows months of speculation after CEO Elon Musk hinted at a lower-priced EV, even though Tesla’s previously planned $25,000 model was scrapped last year. Over the weekend, Tesla posted teaser clips showing headlights and a spinning wheel, building excitement ahead of the October 7 reveal.
| Key Details (as of Oct 2025) | Information |
| Model Name | Low-Cost Tesla Model Y |
| Expected Price | Below $30,000 (after tax credits) |
| Production Start | Final quarter of 2025 |
| Launch Event | Online announcement only |
| Objective | Recover sales amid EV market slowdown |
Musk emphasized affordability as Tesla’s next major focus, saying during a July earnings call,
“The desire to buy the car is very high it’s just that people don’t have enough money in the bank. The more affordable we can make the car, the better.”
The move comes as Tesla faces falling demand for its ageing lineup and tough competition from Chinese and European automakers. The expiration of US EV tax credits in September raised effective prices by $7,500, causing a brief sales surge before the expected slowdown.
Despite challenges, Tesla saw a modest rise in European sales last month and continues to advance projects like robotaxis, humanoid robots, and a simplified Model 3 variant. Analysts believe the upcoming budget-friendly Model Y will be key to Tesla’s ambition of producing 20 million vehicles within the next decade a target linked to Musk’s $1 trillion compensation plan.