Tesla has announced plans to manufacture a budget-friendly electric vehicle (EV) priced at 25,000 (25K) euros at its factory located near Berlin. Insider sources disclosed this information to reporters on Monday, causing Tesla’s shares to surge by 3% during pre-market trading in the United States.
At the time of this publication, Tesla Inc stock (TSLA) has witnessed a surge.
Tesla Inc
Current Price: $220.68
Change : +0.72
Change (%): (0.33%)
Volume: 51.8M
Source: Tomorrow Events Market Data
The high cost of electric vehicles has long been identified as a major hurdle in achieving widespread adoption of this transformative technology, both in Europe and the United States. Recent consumer surveys have highlighted the significant disparity in EV prices, with the average retail cost in Europe surpassing 65,000 euros in the first half of 2023, compared to just over 31,000 euros in China.
Tesla’s CEO, Elon Musk, has expressed a strong desire to bring an affordable electric car to the market. However, this ambition was temporarily put on hold in 2022 due to technological limitations. Sources revealed in September that the automaker had made substantial progress towards a breakthrough, allowing for the die casting of almost the entire underbody of the car in a single piece. This innovation promises to accelerate production and reduce costs.
Currently, Tesla’s German factory focuses on producing the Model Y, which stands as the best-selling electric vehicle in Europe. While officials have indicated that the factory’s capacity could potentially be doubled to accommodate up to 1 million vehicles annually, there has been no update on the actual production figures since March, when it was disclosed that the factory was churning out approximately 250,000 cars per year.
Local authorities are closely scrutinizing Tesla’s expansion plans to ensure compliance with nature conservation laws. A decision on whether to grant approval is anticipated in due course.
In addition to the announcement of the mass-market vehicle, Tesla has also revealed a 4% annual wage increase set to take effect from November. Production workers will see a further boost of 2,500 euros per year starting in February 1924, amounting to an impressive 18% increase in pay over a span of just 1-1/2 years. It is noteworthy that Tesla’s wages were previously below the standards set by the IG Metall labor union’s collective bargaining agreement, lagging behind by 20% of the average rate.
“With the introduction of the groundbreaking 25k euros Tesla EV, the electric vehicle landscape is poised for a transformative shift towards affordability and accessibility, marking a significant milestone in the journey towards sustainable transportation.”
Source: Reuters
