Tesla CEO Elon Musk Denies Report EV Maker Is Abandoning Plan for Lower-Priced EV

Tesla (TSLA) shares were nearly 4% lower in intraday trading Friday as CEO Elon Musk denied a Reuters report that the electric vehicle (EV) maker abandoned its longstanding plan to build a low-priced car, posting on his social media platform X, “Reuters is lying (again).”

Musk has said for years that Tesla's long-term goal was to produce affordable EVs. In the company’s 2006 Master Plan, he wrote “our long term plan is to build a wide range of models, including affordably priced family cars.” Musk had added that Tesla’s strategy was “to enter at the high end of the market, where customers are prepared to pay a premium, and then drive down market as fast as possible to higher unit volume and lower prices with each successive model.”

Reuters noted Musk confirmed its reporting during an analyst call in January that Tesla was set to begin manufacturing its next-generation EV at its Texas gigafactory in the second half of 2025. Reuters said that the car, expected to be called the Model 2, would have a starting cost of about $25,000, about $14,000 below its lowest-priced EV now, the Model 3. 

Tesla did not immediately respond to a request for comment.

Shares of Tesla were down 3.9% at $164.59 as of 2:35 p.m. ET and have lost nearly one-third of their value so far in 2024.