Source: Joe Tegtmeyer

On March 13, 36Kr reported that Tesla's China team is developing a new model in response to intense market competition.

Their sources reveal that the new model will be a "more affordable Model Y." Compared to the existing Model Y, the new car will not have significant changes in battery, power, or chassis.

The insiders mentioned that this model is being developed using "depop," a concept within Tesla to quickly launch products by simplifying configurations without altering main capabilities.

The release time for this more affordable model will be based on the order performance of the new Model Y.

Source: Joe Tegtmeyer

These rumors of a new affordable variant of the Model Y also coincide with recent sighting of a heavily camouflaged Model Y at Giga Texas.

On February 12, EV enthusiast and drone operator Joe Tegtmeyer captured drone pictures of what appears to be a heavily camouflaged Model Y.

Given that the Model Y facelift had already been revealed on January 10, several outlets suggested that the camouflaged car may be the 7-seater version or a low-cost version of the Model Y.

Unlike typical camouflaged cars, this Model Y’s interior was also heavily covered, hinting at a possible “depop” of the interior cabin.

Towards the end of last year, Tesla's Q3 earnings report revealed that preparations were ongoing for the launch of new, more affordable vehicle models, anticipated to begin in the first half of 2025.

This was reinforced during the company's Q4 earnings call last month, where the Tesla team informed investors that the new product was progressing well and would be launched by June this year.

Tesla's CFO, Vaibhav Taneja, stated on the call that they remain on track to introduce a more affordable model in the first half of 2025, and hinted at additional products that would follow this model.

Tesla Beijing staff revealed last week that they had accumulated over 200,000 Model Y pre-orders nationwide in China, with many of those refundable.

If the revamped Model Y does not meet expectations, Tesla is likely to launch the "cheaper Model Y" in the second half of this year.

The Model Y “Juniper” began delivery in the Chinese market on February 26 with upgrades to the exterior design, cabin, and driving range at a starting price of 263,500 CNY.

Since start of deliveries, insurance registrations have shown a ramp up from as low as 350 Model Y through Week 8 (Feb. 17-23) to 6,700 in Week 9 (Feb. 24 - Mar. 2) to 8,700 in Week 10 (Mar. 3-9).

A former Tesla store manager revealed that the Shanghai Gigafactory has an estimated annual production capacity of 750,000 Model Y per year.

Previous reports also reveal that Tesla China plans to sell 520,000 Model Y, compared to 480,000 units sold in 2024.