Reuters Says The $25,000 Tesla Is Dead. Elon Says They're Lying

Reuters reported that Tesla shelved its affordable car in order to focus on its robo-taxi. Elon says it isn't true.

By: Mack Hogan

Apr 5, 2024 at 12:34pm ET

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Reuters reported on Friday morning that the $25,000 affordable Tesla was dead. The outlet cited three sources and internal company messages, claiming that the project had been canceled but that development of an autonomous robo-taxi on the same platform would continue. But shortly after the report came out, Tesla CEO Elon Musk publicly denied the report.

In a tweet to @ZeroHedge, Elon Musk said "Reuters is lying (again)." It is worth noting that Reuters is one of the most respected sources of business journalism in the world, and has a stellar reputation for reliability. Musk, on the other hand, is often more than willing to bend the truth to serve his own interests. He is especially unreliable when it comes to talking about timelines, features and specs of future products. That being said, it doesn't mean he's not telling the truth here.

As @SawyerMerrit on X pointed out, this could be a communication issue. The robo-taxi and affordable Tesla were always supposed to be on the same platform, and it's possible that the company is prioritizing the autonomous version ahead of any human-driven model. Or the autonomous version could be the "affordable" Tesla, though I'm not convinced that anyone can build a fully autonomous car for less than the price of today's Model 3.

It may be hard for Tesla to build anything for much less than the price of the Model 3, which could also explain what's going on. Reuters may have correctly reported the demise of the $25,000 Tesla. When that had an immediate impact on the stock price, well, Elon did what Elon does. He promised that there's more to the story, that he had a secret plan to make it all work out and that investors need not worry. Whether that's true will become clear over time. Right now, it appears that the company is starting to slip.

If Reuters is correct, though, this is a huge blow to EV enthusiasts. Tesla's scale and vertical integration gives it a huge advantage over competitors. No company is better positioned to sell and market an affordable EV to the American public. If Tesla can't make it happen, I'm not sure who can.

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