Tesla Plans to Build Affordable 25,000-Euro Car at Berlin Factory: Source

Electric vehicle maker Tesla aims to expand into the mass market with a more affordable option, according to insider information.

Tesla is set to move significantly towards mass adoption of electric vehicles with plans to build a 25,000-euro car at its factory near Berlin, a source familiar with the matter revealed. The high price of electric cars has been a significant barrier to widespread adoption. Still, Tesla’s new offering aims to address this issue and make electric vehicles more accessible to a broader range of consumers. This development marks a significant step forward for the company and the electric vehicle industry.

Breaking Barriers: The Challenge of Affordability in the Electric Vehicle Market

The cost of electric cars, coupled with high-interest rates, has been a significant hurdle in the adoption of electric vehicles in both Europe and the United States. Consumer surveys have consistently shown that the steep price tag is one of the main factors holding back the uptake of electric vehicles. In Europe, the average retail price of an electric vehicle in the first half of 2023 was over 65,000 euros, compared to just over 31,000 euros in China. This stark difference in pricing has contributed to the slower adoption of electric vehicles in Europe and the United States.

Elon Musk’s Vision: Making Electric Vehicles More Affordable

Tesla CEO Elon Musk has long wanted to create a more affordable electric car. In 2022, he admitted that the company had not yet mastered the technology required to produce a low-cost electric vehicle and, as a result, had put the plan on hold. However, sources revealed in September that Tesla was closing in on an innovation that would enable the company to die-cast nearly all of the underbody of the electric vehicle in one piece. This breakthrough would not only speed up production but also significantly reduce costs, making it possible for Tesla to offer a more affordable option to consumers.

The Path to Mass Market: Tesla’s Ambitious Goals

Expanding into the mass market is a crucial step for Tesla to achieve its goal of increasing vehicle deliveries to 20 million by 2030. This ambitious target sets Tesla apart from its competitors, such as Volkswagen, who have focused on protecting profit margins during the transition to electric vehicles rather than setting specific delivery targets. By offering an affordable electric vehicle, Tesla aims to capture a larger market share and accelerate the adoption of electric vehicles globally.

Tesla’s Factory in Berlin: A Hub of Innovation

Tesla’s factory in Gruenheide, near Berlin, currently produces the Model Y, Europe’s best-selling electric vehicle. The company plans to double the factory’s capacity to 1 million vehicles annually. However, Tesla has not provided an update on the number of cars produced at the facility since March, when it announced that it had reached a production rate of 5,000 vehicles per week, equivalent to approximately 250,000 vehicles annually. The expansion plans are currently under review by local authorities, assessing how the project aligns with nature conservation laws.

A Boost for Workers: Pay Rise and Improved Conditions

During his visit to the Gruenheide plant, CEO Elon Musk thanked the staff for their hard work. He also announced plans to build the 25,000-euro vehicle at the facility, providing further job security and opportunities for the workforce. In addition, Tesla informed its workers that they would receive a 4% pay rise from November onwards, with production workers receiving an additional 2,500 euros per year from February 2024. These improvements in wages and conditions are significant. German union IG Metall highlighted in 2022 that Tesla wages were approximately 20% lower than those offered by other carmakers under collective bargaining agreements.

Tesla’s plans to build an affordable 25,000-euro car at its Berlin factory mark a significant milestone in the company’s mission to accelerate the adoption of electric vehicles. By addressing the issue of affordability, Tesla aims to make electric cars more accessible to a broader consumer base. The expansion into the mass market aligns with Tesla’s ambitious goals of increasing vehicle deliveries and solidifying its position as a leader in the electric vehicle industry. As the demand for sustainable transportation grows, Tesla’s innovative approach and commitment to improving working conditions for its employees position the company for continued success in the rapidly evolving automotive landscape.

About the Author: John Ravenporton

John Ravenporton is a writer for many popular online publications. John is now our chief editor at DailyTechFeed. John specializes in Crypto, Software, Computer, and Tech related articles.