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Home / Business / Tesla's next big thing, model Y, is on the horizon

Tesla's next big thing, model Y, is on the horizon



Last year, CEO Elon Musk announced that Tesla will start preparing for the 2020 mass market SUV production. He expects the work to begin sometime this year, and he predicted that Model Y will be Tesla's best-selling vehicle.

"The demand for model Y will be perhaps 50% higher than model 3, may be even double," Musk told investors at a conference call last week.

If the characters are correct, model Y will have a chance to become the best-selling SUV in the United States, a title currently held by Toyota Rav 4.

SUV is the key for the entire automotive industry as US car buyers shift away from sedans . Traditional car manufacturers like General Motors, Ford and Fiat Chrysler are planning to mostly stop selling sedans in the United States.

One of the reasons why electric vehicles have not taken off is because most of them have been available only in sedan models, said Michelle Krebs, senior analyst for AutoTrader. Electric vehicles still represent just over 1

% of US car sales.

"It hasn't really been a body style that people buy," she said. "The only one out there is now Model X. But that won't be the case for too long."

Model X, the Tesla luxury SUV that debuted in 2015, has not been a hit with critics or customers.

Musk said that the vehicle, with its characteristic falcon back doors and high windshield, proved difficult to do.

"It's an incredible vehicle," he said about model X. "Probably nothing like it will be done again, and maybe it shouldn't."

Musk has a story of convincing and subcontracting on vehicle production. Problems plagued their Model 3 sedan, the company's first mass market effort. It spent much of 2018 and tried to make Model 3 production work.

Model Y will be built on the same platform as Model 3 and share more than 75% of parts. It would keep the costs and time to start production, says Musk.

  Tesla has only offered tease photographs of its next vehicle, the Model Y SUV.
But three years after the debuted model 3 with the promise of making it available for $ 35,000, Tesla has continued to make a version of the car for that mass market price.
Part of it is because Tesla faced a possible cash crunch and had to do so many of the more expensive, more profitable versions of the car before it could start fulfilling orders for the cheaper version.

But there may still be quite a long wait for model Y.

Given the competition, it will probably be face to face with other car manufacturers, slow delivery may be a problem for Tesla.

Finding a place to build it will also be a challenge. To fulfill its production targets for Model 3, Tesla had to build a completely new factory during a permanent tent at its Fremont, California facility.

There is not much capacity to save for model Y at that factory.

Tesla said it would "probably" build model Y in Nevada, on the massive battery factory Gigafactory1.

But it will also require the construction of a brand new assembly line, whether under another tent or inside another building. Most car manufacturers built by other car manufacturers take years from groundbreaking to production, even though Tesla showed that it could move faster than that with its model 3 tent line.


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