The Tesla Model 2, the economic compact project has not been shelved

At the beginning of the year, Tesla’s decision to freeze the development of its new “cheap” electric car, dubbed (without confirmation) Model 2, seemed certain. In practice, a smaller model of the Model 3 and Model Y that it would have a starting price of only $ 25,000 (around 23 million euros). The existence of this project first made headlines in the September 2020 during Tesla Battery Day.

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It was initially announced that this model, which would be designed and manufactured entirely in Giga Shanghai (China), would be launched on the market in 2023. However, Elon Musk cooled the expectations of potential buyers in January 2022 by announcing that his development had been frozen: “Right now we are not working on a $ 25,000 car”.

This decision did not surprise too much. In fact, to begin with, Tesla would have decided to prioritize its previous projects (Cybertruck, Roadster, Semi), which are already accumulating significant delays. Additionally, the company currently sells all of its production and has the second best profit margin per unit in the industry after Ferrari. Which is why it would not be interested in launching a cheaper and therefore less profitable model.

Tesla Model 2, we work in great secrecy not to bring internal competition

Despite it all, some rumors indicated that in reality the project does not appear to be frozen. The real intention behind this announcement was not to damage sales of the current range. In fact, some customers could have decided to cancel the purchase of a Model 3 or a Model Y and wait for the new model.

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These rumors have gained credibility, because according to Chinese sources the first prototypes have already been completed and agreements with suppliers have even been reached. Apparently the first tests were carried out in absolute secrecy not to provoke speculation in the press.

At the time it was confirmed that the model would use LFP batteries like those used in the Standard Range RWD versions of the Model 3 and Model Y. Some media outlets pointed out that, instead of resorting to CATL again, Tesla would be interested in using BYD’s innovative Blade batteries.

For now it is not known whether it will be a sedan or an SUV; however, what is almost certain is that it will fit into the C (compact) segment. The vehicle, which for many should be called Model 2, could however be presented as “Model C” o “Model Q”. It should be based on the Model 3 or Model Y platform.