The initial details of Tesla’s alleged “cheaper model” have been shared in a recent report from Reuters. As per the publication, the upcoming vehicle is designed to grow Tesla’s market share in the highly competitive Chinese EV segment.

Cheaper Model

Citing three people reportedly familiar with the matter, Reuters claimed that the cheaper Tesla will be produced at Gigafactory Shanghai to start. The publication also claimed that the cheaper Tesla will be based on the Model Y, echoing recent reports about a more affordable Model Y variant launching in the Chinese market.

First Details

As per Reuters’ sources, the Model Y-based affordable model is being developed under a project codenamed “E41.” The vehicle will reportedly be built using the company’s existing production lines, though mass production will reportedly start at Gigafactory Shanghai in 2026.

While the upcoming vehicle will reportedly be based on the Model Y, it will be a smaller car overall and cost at least 20% less to produce than the new Model Y that Tesla launched this year. The vehicle will reportedly not be exclusive to China, as it will also be produced in North America and Europe.

Tesla’s Affordable Tease

Elon Musk mentioned Tesla’s affordable model during the fourth quarter 2024 earnings call. As per the CEO, Tesla is “still on track to launch a more affordable model in the first half of 2025 and will continue to expand our lineup from there.”

Tesla, however, has so far been very tight-lipped about its affordable model, leading to speculations that the vehicles may simply be stripped-down versions of the Model 3 and Model Y, the company’s two best-sellers.

A recent Tesla fire in Germany was assigned to a police unit that investigates terrorism and other threats to the state.

According to local police, four Teslas were set on fire around 1:40 a.m. in Berlin, specifically in Plänterwald and Steglitz. The blaze completely incinerated Tesla cars, leaving them “unusable.” In addition, the fire slightly damaged five other vehicles parked near the Teslas.

Berlin police have not officially announced a motive for the Tesla fire. However, they note that a political motive can not be ruled out. Authorities are aware of the rising number of vandalism cases and protests surrounding Tesla as Elon Musk continues his political activities.

The State Security Division of the Berlin State Criminal Police Office leads the investigation into the recent Tesla fire. The police unit investigates threats to the state, including terrorism, extremism, and organized crime.

“No one was injured, and firefighters extinguished the fires. Since a political motive cannot be ruled out, the State Security Division of the Berlin State Criminal Police Office has taken over the ongoing investigation,” commented authorities.

Tesla has been a target of specific organizations in Germany long before Elon Musk supported Trump and his bid for the presidency.

For instance, in 2023, people from de.Indymedia.org claimed responsibility for setting 15 Teslas on fire, resulting in around €500,000 in damages. The platform, which local media identified as left-wing, released a letter calling Tesla their enemy because it exploits resources worldwide.

The year after, Tesla Giga Berlin was the target of an arson attack by the Vulcan Group. The group set fire to an electricity pylon, stopping Giga Berlin’s production for several days. The attack cost over a million euros in repairs.

The arson attack on Tesla Giga Berlin affected a few neighboring districts in Berlin and Grünheide and towns in Brandenburg. Medical facilities were also affected by the Vulcan Group’s attack on Tesla.

Similar to the Tesla fire case by the left-wing platform, the Vulcan Group claimed responsibility for the arson attack on Giga Berlin through a letter. The group states the following:

“Tesla in Grünau eats up [the] earth, resources, people, labor and spits out 6,000 SUVs, killing machines and monster trucks per week.”

Tesla said in a letter to U.S. trade representative Jamieson Greer that it would be a victim of the Trump administration’s tariff imposition strategy, stating it would not be immune to rising costs that could increase the price of its electric cars.

In a letter from Tesla to Greer that was seen by Financial Times, the EV maker said it would be “difficult or impossible” to source some parts of its cars domestically due to supply chain limitations. While it “supports” fair trade, it let the Trump White House know that it would also be exposed to some of the impacts that could be felt as a result of the tariffs:

“Nonetheless, even with aggressive localisation of the supply chain, certain parts and components are difficult or impossible to source within the US.”

It also urged Greer to:

“further evaluate domestic supply chain limitations to ensure that US manufacturers are not unduly burdened by trade actions that could result in the imposition of cost-prohibitive tariffs on necessary components.”

Tesla also sends vehicles to countries like Canada, which are subject to tariffs. The company said the actions by the U.S. “have resulted in immediate reactions by the targeted countries, including increased tariffs on EVs imported into those countries.”

The letter, dated March 11, was written on the same day President Trump purchased a Deep Red Tesla Model S Plaid in an event in front of the White House featuring Musk alongside the President.

President Donald Trump buys a Tesla at the White House – Here’s which model he chose

Tesla’s a great company; they’re American cars, it’s American made. He employs thousands of people. He has the most modern plants in the world,” Trump said on Tuesday. “I know people that have these cars; It blows them away. They love them.”

The letter shows that, while Musk and Trump are currently working alongside one another to iron out government spending, a task the Tesla CEO took on willingly as he campaigned for the President last election season, one thing remains: business is business.

Tesla has pushed prices upward in Canada as a response to the tariffs. Other vehicles in the Tesla lineup, including the flagship Model X, have had their prices see minor increases as well, and this is for U.S. customers.

The Trump administration has played hardball with Canada with tariffs, only for our neighbors up north to impose countertariffs on electric supply to some of the states in the Northeast. It seems, at least early on in as Trump establishes a narrative in his White House of how the U.S. will be treated, there will be some effects that impact Musk’s companies as he works alongside the President.