Tesla contacted suppliers about developing a new affordable electric SUV, according to Reuters — a stunning reversal after CEO Elon Musk canceled the company’s $25,000 “Model 2” in 2024.
The whiplash feels familiar if you’ve been waiting for Tesla to deliver on its affordable EV promises. Musk dismissed cheap electric vehicles as “pointless” in 2024, pivoting resources toward robotaxis and humanoid robots instead. Now Tesla apparently wants back in the budget game, planning to build this mystery SUV first in China, then expand to US and European factories.
The Model 2 That Never Was
Tesla’s promised $25,000 electric car became another casualty of Musk’s autonomous vehicle obsession.
Remember when Tesla promised a $25,000 electric car? That vehicle — internally called the NV91 or “Model 2” — got canceled in 2024. Musk decided pursuing full autonomy made more sense than chasing mass-market sales. The company’s “unboxed process” manufacturing platform, designed specifically for cheap EVs, suddenly became robotaxi infrastructure instead.
Tesla tried splitting the difference with stripped-down versions of existing models. The current Model 3 Standard starts at $36,990, while the Model Y Standard hits $39,990. These “affordable” variants cost roughly 20% less to produce than premium versions, but they sacrifice features like Autosteer and even AM radio. Without federal tax credits, you’re still looking at nearly $40,000 for basic electric transportation.
Market Reality Bites
Tesla’s quarterly delivery numbers reveal the truth behind its premium-only strategy.
Tesla’s sales numbers tell the real story. First quarter 2025 deliveries rose year-over-year but dropped 14% from the previous quarter — a pattern suggesting demand problems rather than production constraints. Meanwhile, competitors like GM and Ford are targeting genuinely sub-$30,000 EVs, making Tesla’s “affordable” offerings look expensive by comparison.
The robotaxi dream that supposedly justified canceling cheap cars remains mostly that — a dream. Tesla’s Full Self-Driving operates under supervision only in Austin, despite Musk’s promises of coast-to-coast autonomy. The technology has logged 9.1 billion miles but needs 10 billion for unsupervised validation.
What This Means for Your Wallet
Tesla’s supplier outreach suggests the company finally heard what budget-conscious buyers have been screaming.
If you’ve been holding off on an EV purchase waiting for Tesla’s mythical cheap car, this supplier outreach suggests the company finally acknowledges what the market keeps screaming: people want affordable electric vehicles. Whether Tesla actually delivers this time depends on your faith in a company that’s canceled affordable EV plans multiple times already.
The smart move? Keep watching, but don’t pause your EV shopping for Tesla’s next promise.
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