The Tesla Model Y is planning to introduce an even more affordable variant to counter Chinese competition.
Reuters Reports indicate that this more budget-friendly Model Y, known as E41 internally, will be manufactured using current production lines at Tesla’s facility in Shanghai.
It is said that mass production will commence in 2026.
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The E41 is expected to cost at least 20 percent less to manufacture compared to the updated Model Y unveiled lately. Interestingly, according to the sources, this vehicle will also be smaller in size.
According to Reuters These Chinese-made vehicles will primarily be sold in China to assist Tesla in maintaining its market position there.
Nevertheless, informants disclosed to the media organization that this cheaper variant will also be manufactured in Europe and North America, although no specific timeline was provided.
This suggests that the E41 might not be limited to China, so it has the potential to arrive in Australia as well. Every Tesla vehicle available in Australia comes from China.
The specifics of how modifications will reduce the size and production costs of the Model Y remain uncertain.
We anticipate that updates such as the ventilated front seats and the rear 8.0-inch touchscreen in the refreshed Model Y might not make the cut.
Despite the Model Y remaining the top-selling vehicle in China for both 2023 and 2024, Reuters Reports indicate that Tesla's share of China's electric vehicle market fell from 11.7 percent in 2023 to 10.4 percent in the previous year.
The Model Y is up against intense competition, particularly from Chinese competitors such as the BYD Sealion 7 , Deepal S07 , Leapmotor C10 and Xpeng G6 — all of which are also available for sale in Australia now.
In addition to this, smartphone manufacturer Xiaomi is debuting its inaugural SUV model, known as the YU7. It's worth noting that their SU7 sedan has apparently outperformed Tesla’s sales figures according to reports. Model 3 each month since December, the Xiaomi SUV is shaping as a credible threat.
Tesla announced the revised pricing for the updated Model Y lineup in Australia earlier this year, setting the starting price for the base model at $63,400 excluding on-road fees — which represents a rise of $7500 compared to the previous version.
This particular model was part of the Launch Series lineup, but you won’t find it listed anymore on Tesla’s Australian website. The exact details of the new base price for the standard version have yet to be announced.
The price range prior to the update started at $55,900 excluding on-road fees, positioning itself below competitors from Japanese, Korean, and American manufacturers.
MORE: Everything Tesla Model Y