A report from Reuters states Tesla is planning a more affordable vehicle based on the Model Y electric crossover. It will be built first in China, but then in North America and Europe.

Tesla reportedly plans to launch a more affordable version of the Model Y in China, produced at its Shanghai Gigafactory, with mass production starting in 2026. This new model will be smaller and cheaper to manufacture,

Key Takeaways Tesla is set to produce and launch a lower-cost Model Y vehicle in China likely in 2026, Reuters reported Friday—citing people with knowledge of the matter.The vehicle will also eventually be launched in Europe and North America,

Tesla has plans to produce a low-cost version of its best-selling Model Y to boost sluggish sales in China, according to a report. The car will cost at least 20% less to produce than the version launched last year,

Tesla sold more than 657,000 vehicles in China, which was a new record for the company. However, sales have slowed in the first two months of 2025, and a cheaper Model

In a bid to regain market share in China, Tesla (NASDAQ:TSLA) is reportedly developing a lower-cost version of its best-selling Model Y in Shanghai. Citing people with knowledge of the matter, Reuters reported that the new model will be more compact and at least 20% cheaper to manufacture than the refreshed Model Y,