Hey everybody, welcome back to the Elon Musk Podcast.
This is a show where we discuss the critical crossroads that
shape SpaceX, Tesla X, The Boring Company, and Neurolink.
I'm your host, Will Walden. What does Tesla's rumoured Model
Q mean for the electric vehicle market?
And could this sub $30,000 model redefine affordability for EV
buyers? And how does the potential
launch of a China specific 3 role model Y factor into Tesla's
strategy? Now, these questions take center
stage as Tesla's latest investor meeting reveals significant
updates about his product road map.
Now, Tesla is reportedly gearing up to launch a new affordable
vehicle, tentatively referred to as the Model Q, in the first
half of 2025. Now Deutsche Bank analyst
following a recent meeting with Tesla's head of investor
relations Travis Axelrod disclosed the vehicle's
projected price less than $30,000.
When including subsidies without USEV tax credits, the price
could rise to $37,499. Analyst Edison Yu characterized
this move as part of Tesla's strategy to expand its total
addressable market, or the T AM, with the Model Q joining a
lineup potentially augmented by other innovations such as a
longer wheelbase Model Y variant for China.
Now, the announcement aligns with Tesla's long term goals of
broadening its appeal by diversifying its lineup and
targeting underserved market segments.
The Model Q would be smaller and lighter than the current Model 3
by approximately 15% and 30%, respectively.
Analysts speculate it will serve as an entry level model with
streamlined features to keep costs down while maintaining
Tesla's reputation for cutting edge technology.
Now, in addition to the Model Q, Tesla appears poised to target
the Chinese market with a new variation of its Model Y Rumors
suggest this vehicle will feature a three row
configuration and a longer wheelbase, aiming to appeal to
families and compete with domestic automakers like BYD.
While Tesla China has declined to confirm specifics, the move
could address growing competition in a market where
affordability and versatility Dr. consumer preferences.
Now. This potential Model Y variant
reflects Tesla strategy of tailoring its offerings to
regional needs. By focusing on China, a crucial
EV market, Tesla could enhance its competitiveness while
reinforcing its global growth objectives.
Now, according to Deutsche Bank, this diversification in product
design could be instrumental in boosting Tesla's production and
delivery numbers in the coming years.
Now, the revelations from the investor meeting have already
influenced financial projections.
Deutsche Bank raised Tesla's stock price target from 295 to
370, setting optimism about the Model Q and other forthcoming
products. Now, Bank of America also
adjusted its outlook after a recent visit to Tesla's Giga
Austin factory, reiterating confidence that a sub $30,000 EV
could significantly expand Tesla's Tam.
Investors appear encouraged by Tesla's continued innovation
despite concerns about fluctuating demand and potential
economic headwinds. And Tesla's stock climbed 3%
during midday trading following the news, extending its recent
winning streak to five days. Now, analysts predict that a
more affordable vehicle could attract a new demographic
buyers, further solidifying Tesla's dominance in the EV
sector. Now, while Tesla's product
announcements have generated excitement, challenges still
remain. Goldman Sachs recently revised
its quarter four delivery estimates downward, setting
potential hurdles in achieving year over year growth in 2024.
Now, concerns about demand have also been amplified by reports
of temporary worker furloughs a Tesla's cyber truck production
line. Now, despite these issues, Tesla
remains a confident outlook. During the investor meeting, the
company projected value growth of 25% to 30% for next year,
emphasizing its ability to maximize production capacity at
existing factories. Such growth could hinge on the
successful rollout of the Model Q and other new vehicles, which
aimed to attract a broader customer base without
compromising profitability. Now, Tesla's ambitions extend
beyond traditional EVs, though the company is making strides in
autonomous driving technology, which is a topic that dominated
much of the investor meeting discussion.
Tesla's Full Self Driving software is undergoing
significant updates, with version 13 reportedly
demonstrating A3 to 5X performance improvement compared
to its predecessor. Analysts expect this iteration
to reduce human interventions to just over one per 10,000 miles.
Tesla's Robotaxi initiative is also a focal point.
The company plans to launch testing in California and Texas
next year, using teleoperators for added safety.
During the initial phase, this fleet will consist of company
owned vehicles, reflecting Tesla's cautious approach to
scaling autonomous services. Now, regulatory hurdles are a
thing. One potential barrier to Tesla's
autonomous ambitions is the regulatory environment.
However, you noted that Tesla anticipates changes under the
incoming US administration, which could streamline federal
guidelines for self driving technology through the National
Hwy. Traffic Safety Administration or
the NHTSA. As such, regulatory shifts could
pave the way for faster deployment of robotaxi services
both domestically and internationally.
The company's optimism contrasts with its history of setting
ambitious goals that have sometimes fallen short.
Yet analysts believe Tesla's current plans, backed by
advancements in FSD technology and anticipated regulatory
support, stand a strong chance of fruition now.
The Model Q's projected affordability signals Tesla's
intent to dominate the budget friendly sector of the EV
market, Competing directly with models like the BYD Dolphin and
Volkswagen ID 3. This vehicle could redefine
customer expectations for cost effective electric mobility.
And by leveraging economics of scale and simplifying features,
Tesla aims to make EV ownership accessible to a much broader
audience. At the same time, Tesla's
exploration of specialized models like the Three Row Model
Y for China shows that they're building for certain
environments. The adaptability may prove
crucial as the global EV market becomes increasingly
competitive. Hey, thank you so much for
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