According to the latest information from Palo Alto, CA – Tesla, the company, is likely to release a breakthrough electric vehicle at a price starting at $15,679 – the Model 2. This step seeks to tackle one of the biggest impediments to mainstream EV adoption: cost. Today, Tesla vehicles — for which the automaker has been heralded as a tech darling — are first and foremost higher-income earners, with the average owner making about $150,000 per year, double the US median household income.
The Model 2 aims to deliver premium EV technology at a reasonable price point for average American consumers, who have a median household income of approximately $75,000. Financial advisors advise that car payments, at most, should never exceed 10-15% of monthly income while being that many potential Tesla buyers are quickly priced out of the market.
In trying to bring the price down to this range, Tesla is taking a several-pronged approach as it seeks to reduce its costs while maintaining a high-quality and safe vehicle. Next-generation solid-state batteries are among the key innovations, allowing for a projected reduction in battery costs to $60 per kilowatt hour. These batteries provide enhanced longevity and play a critical role in overall cost savings.
In addition, the EV maker is also implementing modern manufacturing processes at scale, utilizing massive automation and Giga Casting technology to maximize efficiency and may save up to 30% in manufacturing costs. The company is also keeping engineering costs low by recycling existing platforms and software from previous models, so it’ll be possible to bundle sophisticated driver-assistance features for a lower price than a premium brand’s alternative.
The Model 2, however, is oriented toward city drivers; with a smaller footprint and a target battery range of 350 miles. (“Real people” in this instance being commuters, long-distance travelers and other more typical drivers people in need of affordable style.)
The demand for EVs at reasonable prices is essential to achieving mass adoption and reaching sustainability targets. The rise of models at the low-end price spectrum is telling to how important they are in the all-round consumer purchase, as evidenced in China with models such as the BYD Seagull. Expected Tesla Model 2 coud set the pace for affordable EVs throughout the much of the world.
