Report claims Tesla cancels $25,000 electric car production due to cost concerns.

Elon Musk has reportedly scrapped plans to create a budget-friendly Tesla Model 2 in favor of focusing on developing a robotaxi, according to Reuters. Musk’s decision, relayed to employees during a company meeting in February, marks a shift in strategy from previously announced plans to introduce a $25,000 electric vehicle to attract a wider consumer base. This move comes as Tesla faces growing competition from Chinese automakers producing more affordable EVs, with Musk warning that allowing Chinese companies to sell cheap electric vehicles in the US could threaten domestic automakers like Tesla.

The cancellation of the Tesla Model 2 project underscores Musk’s commitment to prioritizing the production of a robotaxi over a low-cost electric vehicle. Despite initial promises of a budget-friendly EV, Tesla is now focusing on bringing its next-generation platform to market, with production targeted for the end of 2025. Musk’s emphasis on advancing autonomous driving technology reflects Tesla’s broader vision of transforming the way vehicles are manufactured and operated. While Tesla faces challenges from Chinese automakers in the EV market, the company continues to innovate with plans for a robotaxi and other next-gen vehicle platforms.

Musk’s decision to forego the Tesla Model 2 in favor of a robotaxi aligns with his long-term vision for Tesla’s future. As the automotive industry evolves towards electrification and autonomy, Tesla seeks to stay competitive by prioritizing cutting-edge technologies over traditional vehicle models. With a focus on revolutionizing car ownership with autonomous vehicles and advanced manufacturing processes, Tesla aims to maintain its position as a pioneer in the electric vehicle market. While the cancellation of the Tesla Model 2 may disappoint some consumers, Tesla’s strategic shift underscores its commitment to innovation and adaptation in a rapidly changing industry landscape.

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