Tesla is aiming to manufacture a “compelling” $25,000 electric vehicle within the next three years by making use of improved battery technology, CEO Elon Musk said Tuesday during the company’s “Battery Day” presentation.
Musk set the goal during a lengthy presentation on Tesla’s improved battery cell design. Tesla’s “tab-less” batteries would improve vehicle range by 16%, be six times more powerful and have five times the energy capacity of current-generation batteries.
While Tesla won’t begin mass-producing the batteries for months, the company expects the improved design to help lower vehicle production costs in the coming years. Musk said the development of an affordable mass-market electric vehicle “has always been our dream from the beginning of the company.”
“Our first car was an expensive sports car, then it was a slightly less expensive Sedan and finally, sort of a mass-market premium, the Model 3 and Model Y. But really, it was always our goal to try to make an affordable electric car,” Musk told shareholders during the “Battery Day” event. “I think probably, about three years from now, we’re confident that we can make a very compelling $25,000 electric vehicle that’s also fully autonomous.”
Tesla shares were down more than 4% in after-hours trading. Earlier on Tuesday, Tesla shares fell after Musk said the technological advancements announced during Battery Day would not enter “high volume production” until 2022.
Musk said the company has yet to come up with a name for the $25,000 vehicle.
During a shareholder presentation prior to the Battery Day event, Musk said Tesla expects vehicle shipments to rise 30 to 40 % in fiscal 2020 compared to one year ago. The company is on track to deliver its first-ever full-year profit this year.
“The future is looking very promising from an annual profitability standpoint,” Musk said.