We waited an eternity for Tesla to launch the Cybertruck, but it sounds like we won’t have to wait long for the EV maker to add a fifth model to its lineup. Sources close to the project say Tesla has informed suppliers that the new car is codenamed “Redwood” and will start production in June 2025.
If it has any significance at all, the “Redwood” name almost certainly alludes to the potentially huge sales figures the new EV could generate, rather than its size. Insiders described the new model to Reuters as a compact crossover, which suggests it is in fact the hotly-anticipated $25k entry-level Tesla.
Whether the baby EV comes in close to that price, which was mooted several years ago before a period of high inflation, remains to be seen. But it will definitely undercut the brand’s current cheapest car, the $38,990 Model 3, by a large margin and will be crucial in Tesla’s battle with Chinese automakers. One such firm, BYD, recently overtook Tesla as the world’s biggest producer of electric vehicles.
Related: Everything We Know About Tesla’s $25,000 Model 2 Compact EV
Key to the new model’s low price is a new-generation Tesla EV platform that dramatically reduces production costs and is sure to get rival brands, who are already rattled by Tesla’s ability to cut prices, very worried. The platform won’t only be used on the baby EV, but also a robotaxi as well as the replacements for cars like the Model 3 and Model Y.
Reuters reports that Tesla procured quotes for the “Redwood” project last year from suppliers when it suggested that weekly production volumes could reach 10,000 units. That’s half a million cars per year, which would make a huge difference to the company’s overall output. Last year Tesla’s production grew by 35 percent to 1.85 million, but in May of 2023, CEO Elon Musk said he was working on two new products that could together have the potential to generate 5 million sales per year.
Industry watchers think the baby EV will be produced initially at Tesla’s Texas plant before production is extended to other sites around the world. They also suggest that, given Musk’s propensity to over-promise and under-deliver when it comes to launch timings, some level of production might start in 2025, as Reuters’ sources claim. Still, full production won’t happen until 2026.
This story includes speculative illustrations for a compact Tesla model by Jean Francois Hubert/SB-Medien for CarScoops. The designs are neither related to nor endorsed by Tesla.