Tesla to build circa $A40,000 EV in Germany, Musk says

Reports out of Germany say that Tesla’s CEO Elon Musk has confirmed that the company plans to make the long awaited €25,000 ($A40,000) electric car for the Europen market at its Giga Berlin factory.

The announcement was made while speaking to staff at the state-of-the-art GigaBerlin factory in Brandenburg, Germany, where the new EV is to be made, with similar projects in line for the Austin factory and in Mexico.

The development of the €25,o00 Tesla EV – a price that Tesla could never quite deliver with the Model 3 – will put further pressure on legacy car makers who are struggling to produce electric cars of their own at a profit and find themselves unable to match Tesla’s current stock in price.

“Ramping up while VW, GM, BMW, Ford, etc. are ramping down,” observed one Tesla enthusiast on social media in response to the news.

In recent months, the automotive industry in Germany has seen large companies like Volkswagen (VW) pause production at its EV manufacturing plants due to what the company calls “lower than expected demand” for its EV products, while GM and Ford have flagged winding back on their own EV plans.

The new announcement continues the spectacular cost reductions since Tesla produced its first EV, the Roadster, at a price of $A222,995 driveaway, making it one of the most expensive cars of its time.

Since then Tesla launched the Model S and Model X, along with the Model 3 and Model Y, and delivered significant gains on manufacturing processes at the same time, unencumbered by legacy issues. Each of the second and third generations of Tesla’s cars helped bring the price down, allowing millions more people to own an electric car.

As Tesla continues to expand its product line-up while ramping production of its very popular Model Y, more drivers will prefer an EV from a brand known for its EV products built locally on the European continent.

By now having announced plans to workers at the Tesla factory to produce a more affordable model, it showcases Tesla’s ambitions to manufacture and deliver hundreds of thousands of mass-market electric cars. 

This would help many more European drivers to make the switch to cleaner vehicles, in line with Europe’s target to lower transport emissions.