Elon Musk, CEO of Tesla made a recent announcement regarding the next-generation small EV that the company was working on. Musk said that the next-gen budget car will generally operate in autonomous mode and there was a clear path to make and deliver a car that cost half as much as the Tesla Model 3 Sedan. 

Musk did not give any more details fo the vehicle. However, this is not the first time that Musk promised to deliver a budget EV. In 2020, Tesla announced that it was planning to make a small-budget car that would be fully autonomous and cost less than $25,000. The company promised to deliver the car within three years by 2023.

The low-end budget car which is unofficially referred to as Tesla Model 2 will be smaller and cheaper than Tesla Model 3 which at around $42,990 is the cheapest EV offered by the company.  Experts speculate that Model 2 will come with a 25% smaller battery and 15% smaller body as compared to Model 3. It will also be 30% lighter than Model 3. 

Since its inception, Tesla customers and fans have lamented about the need for a budget EV from the company. The cheapest vehicle is the Model 3 Sedan which costs around $43,000. While there was a time when you could buy the base variant of Model 3 for $35,000, today the base model is priced at $43,000. However, Tesla claims that the net cost after tax credits and gas savings for the Model 3 base variant in California comes to around $29,000 and the Model 3 base variant is already offered at a competitive price and is cheaper than the famous Toyota Corolla. 

The company is planning to launch its budget car for less than $30,000. Tesla has always run its business on the philosophy of making them better and cheaper at the same time. The company is essentially trying to convert a car into a computer and use advanced technology, to not only improve the performance of the vehicle but also make it cost-effective. Though the company has not always achieved this goal, with the Model 2 budget EV it plans to launch a smaller, cheaper, and better car than before. 

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(source)

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